nternational Industries sells on terms of 3/10, net 50. Gross sales last year were 5,662,500 and accounts receivable averaged 547,500. Half of International’s customers paid on the 15th day and took discounts. What are the nominal and effective costs of trade credit to International’s non-discount customers? (Hint: Calculate sales/day based on a 360-day year, then calculate average receivables of discount customers and then find the DSO for the non-discount customers

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Q: Sanders Prime Time Company has annual credit sales of $1,800,000 and accounts receivable of…

A: Average collection period (ACP) is the time taken to collect the cash from its accounts receivables.…

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A: Credit Term of 3/25, Net 50 shows that buyers will get discount of 3% if payment is made in 25 days…

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A: Sale per day = $12,500 Discount sale = 0.5 ($12,500)                       = $6,250   Account…

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A: Step 1 Financial instruments are assets that can be traded, or contractual; agreement between…

Q: McEwan Industries sells on terms of 3/10, net 35. Total sales for the year are $1,947,000; 40% of…

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Q: Medwig Corporation has a DSO of 20 days. The company averages $3,500 in sales each day (all…

A: Accounts receivables are the money due towards the customers but not yet paid. The accounts…

Q: McEwan Industries sells on terms of 3/10, net 30. Total sales for the year are $1,921,000; 40% of…

A: “Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: Miyagi Data, Inc., sells earnings forecasts for Japanese securities. Its credit terms are 2/30, net…

A: Average collection period: It is the time period that business takes to collect its payment from its…

Q: McDowell Industries sells on terms of 4/10, net 40. Total sales for the year are $825,500. Thirty…

A: Discounted customers=15×30%=4.5 days

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A: Winther company's Receivable turnover = 15 Average net receivables = P430000 Average net receivable…

Q: Medwig Corporation has a DSO of 17 days. The company averages $7,750 in sales each day (all…

A: Accounts receivable are the people who owe the company. In simple words these are the people who…

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A: Given:

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A: Part (a): Calculation of days' sales outstanding: Answer: Average amount of receivables is 38 days

Q: Zane Corporation has an inventory conversion period of 48 days, an average collection period of 26…

A: Cash conversion cycle(CCC) will be CCC =Inventory conversion period + Average collection period…

Q: accounts receivable turno ratio of a company is 2, annual credit sales IS $ nat is the average…

A: Given, Accounts receivable turnover = 2 Annual credit sales = $719550

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A: Formula: Estimated uncollectible accounts = Credit sales x percent of estimated uncollectible…

Q: Bulldogs Inc. had credit sales last year amounted to P18,600,000. The firm also had an average…

A: Solution.. Credit sales = P18,600,000  Average accounts receivable = P1,380,000  Average collection…

Q: Jane sport shop projects the following sales, P75,000 for April, P95,000 for May, and P110,000 for…

A: The schedule of cash receipts depends upon the credit period allowed to the customer as per the…

Q: Kirk Development buys on terms of 2/15, net 60 days.  It does not take discounts, and it typically…

A: The calculation is:

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Q: Taylor Company provides the following information: Annual credit sales : $ 24,000,000 Collection…

A: Average collection period means the average time period with in which the debtor makes the payment.…

Q: TMRW Co. has annual credit sales of $1,080,000 and an average collection period of 32 days in 2010.…

A: 1.  TMRW Co.-   Average accounts receivable balance =  (Annual Credit Sales / 360 days) x Average…

Q: McDowell Industries  sells on terms of 3/10, net 30. Total sales for the year are $912,500;  40% of…

A: “Hey, since your question has multiple sub-parts, we will solve first three sub-parts for you. If…

Q: McDowell Industries sells on terms of 3/10, net 30. All sales for the year are on credit amount to…

A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: If ABC Corporation has annual credit sales of Ᵽ990,000 and its average accounts receivable is…

A: The Numerical has covered the concept of Accounting Ratio.  The Formula is used to calculate the…

Q: Knight Roundtable Co. had annual credit sales of $1,080,000 and an average collection period of 32…

A: Accounts receivables are the short term assets to the company. When customer buys goods on credit…

Q: La Resolana, S.A., has credit sales of $180,000 per year, with net payment terms of 30 days, which…

A: Accounts receivables are the current assets of the company which arises due to sale made on credit…

Q: Zane Corporation has an inventory conversion period of 79 days, an average collection period of 43…

A: Calculate the cash conversion cycle as follows: Cash conversion cycle = Inventory  period +…

Q: Axis Wells and Excavation (AWE) currently generates $198,000 in annual credit sales. AWE sells on…

A: Day sales outstanding is the number of days it takes for the company to recover its revenue from…

Q: nider Industries sells on terms of 2/10, net 25. Total sales for the year are $600,000. Thirty…

A: Days Sales Outstanding means the number of days taken by the firm to collect the payment from their…

Q: Cost of Trade Credit Grunewald Industries sells on terms of 2/10, net 50. Gross sales last year…

A:

Q: Sixty percent of Jesse's annual sales of P900,000 is on credit. If its year-end receivables turnover…

A: Annual Sales = 900,000 Credit Sales = 60% * Annual Sales = 60% * 900,000 = 540,000 Receivable…

Q: Milton Company provides this information for the month of November, 2008: sales on credit P150,000;…

A: Formula: Net sales = Cash sales + Credit sales - Sales discount - Sales returns and allowances

Q: Cook Security Systems has a $37,500 line of credit, which charges an annual percentage rate of prime…

A: Interest rate will be equal to addition of current prime rate plus annual percentage rate. = 8% + 4%…

Q: ve costs of trade credit to International’s non-discount customers? (Hint: Calculate sales/day based…

A:

Q: International Industries sells on terms of 3/10, net 50. Gross sales last year were 5,662,500 and…

A: Given information: Credit terms 3/10, net 50 Last year gross sales amounted to $5,662,500 Average…

Q: Cook Security Systems has a $37,500 line of credit, which charges an annual percentage rate of prime…

A: Given Information: Credit line is $37,500Charges an annual percentage rate of 4% plus prime rate…

Q: Assume that ABC Corporation pays for each purchase three (3) weeks after date of purchase. Maintains…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Zane Corporation has an inventory conversion period of 90 days, an average collection period of 34…

A: a. Cash conversion cycle = Inventory turnover day + Receivables day – Payables day

Q: Cook Security Systems has a $37,500 line of credit, which charges an annual percentage rate of prime…

A: Given: The cook security systems having the value of $37,500 with the annual percentage rate is 4%.…

Q: McGriff Dog Food Company normally takes 30 days to pay for average daily credit purchases of $9,730.…

A: Credit is the capacity to borrow money or get goods or services with the expectation of repaying it…

Q: The Malibu Corporation has annual credit sales of $28 million. The average collection period is 30…

A: Day sales in receivables= 365/receivables turnover 30 =365/ receivables turnover receivables…

Q: a. If the balance in accounts receivable at the end of 1991 was $500,000 and $750 million , how long…

A: This can be arrived at by using average collection period (ACP) formula. It measures the average…

Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.