IF a firm buys on trade credit terms of 3/10, net 50 and decides to forgo the

Fantastic news! We've Found the answer you've been seeking!

Question:

IF a firm buys on trade credit terms of 3/10, net 50 and decides to forgo the trade credit discount and pay on the net day, what is the annualized cost of forgoing the discount (assume a 360–day year)?

The annualized cost of the trade credit terms of 3/10, net 50 is %. (Round to two decimal places.)

Related Book For answer-question

Financial Management Principles and Applications

ISBN: 978-0133423822

12th edition

Authors: Sheridan Titman, Arthur Keown, John Martin

See More Books

Posted Date: Jun 29, 2018 11:30 AM

See More Questions

If a firm buys on trade credit terms of 2/10, net 60 and decides to forgo the trade credit discount and pay on the net day, what is the effective annualized cost of forgoing the discount?
If a firm buys on trade credit terms of 2/10, net 50 and decides to forgo the trade credit discount and pay on the net day, what is the annualized cost of forgoing the discount (assume a 360-day...
A supplier has offered Royston Ltd. trade credit terms of 2/15, net 45. Royston Ltd. has an average accounts payable of $45 and its average daily cost of goods sold is $1.88. All figures are in...
= 0.5. The p.d.f. for the waiting time X until an event occurs often follows the exponential distribution (to be studied in Section 7.6), with the form g(x) = e-x for some positive value of , defined...
United Jersey Bank of Princeton purchased land and a building for the lump sum of $6.0 million. To get the maximum tax deduction, the bank's managers allocated 80% of the purchase price to the...
One item is omitted in each of the following summaries of balance sheet and income statement data for four different corporations, AL, CO, KS, and MT. Determine the missing amounts, identifying them...
Eco Manufacturing Ltd produces timber felling machines for the forestry industry around the world. Its two machines are the Tree Toppler, which cuts down trees and clears undergrowth, and the Timber...
Selected transactions for R. Sparks, an interior decorator, in her first month of business, are as follows. Jan. 2 Invested $10,000 cash in business. 3 Purchased used car for $4,000 cash for use in...
Describe the situation from either your professional experience or your research in which unethical or fraudulent behavior occurred. If you are describing an example from experience, please do not...
Upsidedown Cake Company produces dessert products for sale in grocery stores, but it also has a retail location. At the end of 2018, the company had $349,000 in accounts receivable before netting out...
A 6 cm diameter pipe is used to drain a water reservoir. The elevation difference between the reservoir water surface and the pipe exit is 50 m. If the pipe is 400 m in length and f is 0.028,...
If a ball is "soft," it will spend more time in contact with the floor and won't rebound as high as it is supposed to. The force on the floor of the "soft" ball is the force on the floor of a...
A 4.0-m-diameter playground merry-go-round, with a moment of inertia of $400 \mathrm{~kg} \cdot \mathrm{m}^{2}$, is freely rotating with an angular velocity of $2.0 \mathrm{rad} / \mathrm{s}$....
Consider the sequence of energy transformations in the bounce. When the dropped ball is motionless on the floor, compressed, and ready to rebound, most of the energy is in the form of A. Kinetic...
The heat exhausted to the cold reservoir of an engine operating at maximum theoretical efficiency is two-thirds the heat extracted from the hot reservoir. What is the temperature ratio...
Do convection cells represent a reversible process? A. Yes, because they are orderly. B. No, because they transfer thermal energy from hot to cold. C. It depends on the type of convection cell.
A solution of HNO3 is standardized by reaction with pure sodium carbonate. 2H+ + Na2CO3 2 Na+ + H2O + CO2 (FM A volume of 27.07 0.06 mL of HNO3 solution was required for complete reaction with 0.8987...
Define cultural intelligence. Cite the books or journal articles you found in Capella's library. Explain why cultural intelligence is important for HR practitioners and other organizational managers.
If the risk-free rate is 3% and the expected market return is 9%, what is the required return for a stock with a beta of 1.6? a. 14.40% b. 17.40% c. 12.72% d. 12.60%
You are putting together a portfolio made up of four different stocks. However, you are considering two possible weightings: a. What is the beta on each portfolio? b. Which portfolio is riskier? c....
The liabilities and owners equity for Campbell Industries is as follows: Accounts payable ........$ 500,000 Notes payable ........ 250,000 Current liabilities .........$ 750,000 Long-term debt...
As a member of the Finance Department of Ranch Manufacturing, your supervisor has asked you to compute the appropriate discount rate to use when evaluating the purchase of new packaging equipment for...
Wallace and Hussain type estimators for the variance components of a one-way unbalanced panel data model. (a) Verify the $E\left(\widehat{q}_{1} ight)$ and $E\left(\widehat{q}_{2} ight)$...
Consider the following unbalanced one-way analysis of variance model \[y_{i t}=\mu_{i}+u_{i t} \quad i=1, \ldots, N \quad t=1,2, \ldots, T_{i}\] where for simplicity's sake no explanatory variables...
Consider the three-way error component model described in problem 3.15. The panel data can be unbalanced and the matrices of dummy variables are \(\Delta=\left[\Delta_{1}, \Delta_{2}, \Delta_{3}...

IF a firm buys on trade credit terms of 3/10, net 50 and decides to forgo the

Question:

Expert Answer:

Cost ... View the full answer

Financial Management Principles and Applications

Students also viewed these accounting questions