The singer - who rose to fame after winning UK TV talent show The X Factor, on which Simon is a judge - will have to pay out the large sum after her new track Bad Boys topped the UK singles charts.
The 21-year-old star was convinced she would lose out to Robbie Williams, who released his comeback single Bodies at the same time.
A source told Britain’s Daily Mirror newspaper: Simon Cowell was adamant that she could beat Robbie, but Alex wasn’t having any of it. She thought how on earth could she beat someone who had so much success in the past. So when she discovered that she had, she was overwhelmed with excitement and then she remembered her little bet with her boss.
Rather than giving the money to Simon, Alexandra will donate the sum to London’s Battersea Dogs and Cats Home and has convinced the music mogul to match her contribution.
Meanwhile, Alex has revealed she almost caused a road accident when she heard she had reached the top spot.
She laughed: I was in a car when I was told and the man who was driving nearly crashed because I screamed so hard in his ear.
The beauty has also revealed the chart-topping track resembles her taste in men very closely.
She said: I love bad boys - this song is a reflection of my personality. Sometimes I won’t admit it because I don’t want to look like a fool when they break my heart.
