Why is some trade credit called free while other credit is called costly? If a firm buys

Question:

Why is some trade credit called free while other credit is called costly? If a firm buys on terms of 2/10, net 30, pays at the end of the 30th day, and typically shows $300,000 of on its balance sheet, would the entire $300,000 be free credit, would it be costly credit, or would some be free and some costly? Explain your answer. No calculations are necessary.

Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive...