On September 1, a firm grants credit with terms of 2/10 net 30. The creditor:

must pay a penalty of 2/10 of one percent when payment is made later than October 1.

receives a discount of 2 percent when payment is made on September 1and pays a penalty of 10 percent if payment is made after October 1.

receives a discount of 2 percent when payment is made within 10 days. must pay a penalty of 10 percent when payment is made later than 2 days after October 1.

receives a discount of 2 percent when payment is made at least 10 days prior to October 1.