Juan's Engineering buys circuit boards with a list price of \( \$ 32,000 \). If the supplier extends trade discounts of \( 42 / 32 / 12 \), what is the trade discount amount?
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To calculate the trade discount amount, you can work through the discounts step by step. First, apply the 42% discount on the list price: \[ \$32,000 \times 0.42 = \$13,440 \] Subtract this from the list price: \[ \$32,000 - \$13,440 = \$18,560 \] Next, apply the 32% discount on the new amount: \[ \$18,560 \times 0.32 = \$5,939.20 \] Subtract this from the adjusted price: \[ \$18,560 - \$5,939.20 = \$12,620.80 \] Now, apply the final 12% discount: \[ \$12,620.80 \times 0.12 = \$1,514.50 \] Subtract this from the latest adjusted price: \[ \$12,620.80 - \$1,514.50 = \$11,106.30 \] The total trade discount amount therefore is: \[ \$13,440 + \$5,939.20 + \$1,514.50 = \$20,893.70 \] So, the trade discount amount is \( \$20,893.70 \).