Question: Barnes knows that SKI sells on the same credit terms as other firms in its industry. Use the ratios presented earlier to explain whether SKIs

Barnes knows that SKI sells on the same credit terms as other firms in its industry. Use the ratios presented earlier to explain whether SKI’s customers pay more or less promptly than those of its competitors. If there are differences, does that suggest that SKI should tighten or loosen its credit policy? What four variables make up a firm’s credit policy, and in what direction should each be changed by SKI?

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SKIs DSO is 4563 days as compared with 32 days for the average firm in its industry This suggests that SKIs customers are paying less promptly than th... View full answer

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