What is the meaning of net price?
The term net price or simply the pocket price is in essence the price that is paid by the customers after the accounting is done for not only the on – but also the off – invoice discounts. In other words, this net price refers to the cost of a particular product which is the cost minus the price of anything which could lower the total value that a customer pays.
Net Price Calculator
What exactly is net price?
Hence this net price is stated to be the final price that is paid by the buyer or the consumer for the goods & services. Another aspect to be kept in the mind is that this net price comes forth only when the tax or for that matter any other tax is being deducted. Moreover, this term, the net price is put in to practice mostly by the colleges besides the universities.
Let us take an example to understand this aspect in a better manner. For example the total cost of the tuition fee is arrived at only when the other costs are part of this fee & these terms generally include words like scholarships / grants / merit awards & the like. Additionally, these are subtracted in order to arrive at the net price. On the other hand, when it is about the business then this net price is also known as the net cost.
What is the formula used in a net price calculator?
In a net price calculator, the formulae which are put in to use have been mentioned below –
\(Net \,Price \,=\, List\, Price (1-Rate\, of\, Discount) \)
or\( \,N \,=\, L\, (\,1\,-\,d\,)\)
\(this\, (\,formula\,)\, depends\, on\, the\, number\, of\ the\, trade\, discounts\)
\(Selling\, Price\, = \,Net\, Price\, (\,1 \,-\, Rate\, of\, Cash\, Discount\,)\)
What is meant by net?
In economics, net or nett means that it is the resultant amount which has been gotten only after the sum or even after the difference of 2 or more than 2 variables (has been done). In addition to this, in economics, net is more often than not put in to use in order to imply remaining value at a time when the accounting for a particular or the generally understood deduction has taken place.
Origins of the word net
As far as the word net is concerned then it is 1 word that finds its origins in the Latin word nitere which means to shine & nitidus meaning elegant or trim or even from the French word net which represents sharp or neat or clean.
How to use an online net price calculator?
If you wish to take the help of this net price calculator, then you will have to just follow the instructions to get the result. However, the most important aspect to be kept in the mind is that the values entered are correct so that the result is also correct.