JAMB Accounts Principles of Accounts 2010 Paper

Concept:Discount allowed is a percentage reduction granted on the purchase value.Explanation:Fatima's cash purchase is $\mathrm{N}2,000$.The rate of discount allowed is $2\%$.Discount allowed $= 2\%$ of $\mathrm{N}2,000$.$= \dfrac{2}{100} \times 2,000 = 40$.So the discount allowed amounts to $\mathrm{N}40$.Answer:The discount allowed is $\mathrm{N}40$, which is option B.