Question: Assume that you have been offered cash discounts on merchandise
Assume that you have been offered cash discounts on merchandise that can be purchased from either of two suppliers. Supplier A offers trade credit terms of 3/20, net/70, while Supplier B offers 4/15, net/80. What is the approximate effective cost of missing the cash discounts from each supplier? If you could not take advantage of either cash discount offer, which supplier would you select?
Answer to relevant QuestionsCompute the effective cost of not taking the cash discount under the following trade credit terms a. 2/10 net 40 b. 2/10 net 50 c. 3/10 net 50 d. 2/20 net 40 Construct a spreadsheet that computes the effective annual rates on the commercial paper offerings. Inputs to the spreadsheet should include the dollar amount of paper to be issued, the number of days the paper is ...Beckheart is seeking financing for its inventory. Safe-proof Warehouses offers space in their facility for Beckheart’s inventory. They offer loans with a 15-percent APR equal to 60% of the inventory. Monthly fees for the ...How does the modified internal rate of return measure improve upon the IRR measure? What is a way to keep managers accountable for their capital budgeting forecasts and estimates?
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