Lincoln offers credit terms of net 30 and net 50. Management believes that 60 percent will...

 

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Lincoln offers credit terms of net 30 and net 50. Management believes that 60 percent will receive net 30 and the rest will receive net 50. Management expects that 70 percent of the net 30 group will pay on time, and the remaining 30 percent will pay 10 days late. They also expect that all of the net 50 customers will pay on time. Calculate the ACP. Lincoln offers credit terms of net 30 and net 50. Management believes that 60 percent will receive net 30 and the rest will receive net 50. Management expects that 70 percent of the net 30 group will pay on time, and the remaining 30 percent will pay 10 days late. They also expect that all of the net 50 customers will pay on time. Calculate the ACP.

Answer rating: 100% (QA)

To calculate the Average Collection Period ACP we first need to calculate the weighted average days ... View the full answer