How to Calculate Effective Cash Discount Rate?
Effective Cash Discount Rate calculator uses Effective Cash Discount Rate = (Cash Discount Rate*360)/(Term for Payment-Cash Discount Period) to calculate the Effective Cash Discount Rate, Effective Cash Discount Rate refers to the annualized rate of return a company earns on its investments or operations when taking advantage of cash discounts offered by its suppliers. Effective Cash Discount Rate is denoted by ECDR symbol.
How to calculate Effective Cash Discount Rate using this online calculator? To use this online calculator for Effective Cash Discount Rate, enter Cash Discount Rate (CDR), Term for Payment (TP) & Cash Discount Period (CDP) and hit the calculate button. Here is how the Effective Cash Discount Rate calculation can be explained with given input values -> 6.822157 = (6.5*360)/(350-7).