What is the payment term for stock purchases?

What is the payment term for stock purchases?

• A. Within 15 days from delivery
• B. Cash on delivery only
• C. Within 30 days from the date of delivery
• D. Net 90 days

Answer: (C)

Payment terms define when you must pay for stock after it arrives. Net 30 means payment is due within 30 days from the delivery date, a common credit arrangement that helps cash flow by giving the pharmacy time to process the order and generate revenue before payment is due. This aligns with typical supplier practices for stock purchases. Cash on delivery would require paying at the moment of delivery, not after. A term of within 15 days is shorter than the standard, and Net 90 would extend the payment period much longer than usual. So, paying within 30 days from delivery best captures the common default for stock purchases.

Payment terms define when you must pay for stock after it arrives. Net 30 means payment is due within 30 days from the delivery date, a common credit arrangement that helps cash flow by giving the pharmacy time to process the order and generate revenue before payment is due. This aligns with typical supplier practices for stock purchases.

Cash on delivery would require paying at the moment of delivery, not after. A term of within 15 days is shorter than the standard, and Net 90 would extend the payment period much longer than usual. So, paying within 30 days from delivery best captures the common default for stock purchases.