Regis Clothiers can borrow from its bank at 19 percent to take a cash discount. The terms

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Regis Clothiers can borrow from its bank at 19 percent to take a cash discount. The terms of the cash discount are 214, net 55.

a. Compute the cost of not taking the cash discount (Use a 360-day year. Do not round intermediate calculations. Input your final answer as a percent rounded to 2 decimal places.)

Answer is complete but not entirely correct.

Cost of not taking a cash discount 17.39%

b. Should the firm borrow the funds?

No Yes

Related Book For answer-question

Foundations of Financial Management

ISBN: 978-1259194078

15th edition

Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen

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Posted Date: Mar 08, 2022 10:54 PM

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Regis Clothiers can borrow from its bank at 19 percent to take a cash discount. The terms

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Foundations of Financial Management

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