a. If a firm buys under terms of 3/15, net 45, but actually pays on the 20th

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a. If a firm buys under terms of 3/15, net 45, but actually pays on the 20th day and still takes the discount, what is the nominal cost of its non-free trade credit?

b. Does it receive more or less credit than it would if it paid within 15 days?

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Financial management theory and practice

ISBN: 978-0324422696

12th Edition

Authors: Eugene F. Brigham and Michael C. Ehrhardt

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Question Posted: Mar 18, 2010 01:35 AM

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a. If a firm buys under terms of 3/15, net 45, but actually pays on the 20th

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a Because the firm still takes the discount on Day 20 20 is ...View the full answer

Financial management theory and practice

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