Tools & More orders $40,000 of merchandise on account from Hammer Supply. Hammer Supply accepts the order by sending an invoice with the terms 2/10, n/30. Tools & More is considering taking the discount but would have to borrow funds in order to pay within the discount period. The bank is charging a 5% annual interest rate. Assume a 360-day year. Discount (2% $40,000) $800 Interest ($39,200 5% 20/360) 109 Savings from discount $691