PRIN.OF CORPORATE FINANCE >BI<
12th Edition
ISBN: 9781260431230
Author: BREALEY
Publisher: MCG CUSTOM
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Question
Chapter 30, Problem 14PS
Summary Introduction
To determine: Rate of interest when 2/30 and net 60.
Summary Introduction
To discuss: Rate of interest when 2/5, EOM, net 30.
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Students have asked these similar questions
As a company accounts payable manager, which of the following credit terms are most likely to entice you to take the cash discount?
A. 2/10 net 90
B. 1/10 net 45
C. 2/10 net 60
D. 1/10 net 30
Question The average collection period is the average amount of time that elapses from a credit sale until the company can use the payment (collection) of the sale.
True or false?
Write a note on cash discounts.
Chapter 30 Solutions
PRIN.OF CORPORATE FINANCE >BI<
Ch. 30 - Inventory What are the trade-offs involved in the...Ch. 30 - Prob. 2PSCh. 30 - Prob. 3PSCh. 30 - Prob. 4PSCh. 30 - Prob. 5PSCh. 30 - Prob. 6PSCh. 30 - Prob. 7PSCh. 30 - Credit policy How should your willingness to grant...Ch. 30 - Cash management Complete the passage that follows...Ch. 30 - Prob. 10PS
Ch. 30 - Prob. 11PSCh. 30 - Prob. 12PSCh. 30 - Prob. 13PSCh. 30 - Prob. 14PSCh. 30 - Credit terms Phoenix Lambert currently sells its...Ch. 30 - Prob. 16PSCh. 30 - Prob. 17PSCh. 30 - Prob. 18PSCh. 30 - Prob. 19PSCh. 30 - Prob. 20PSCh. 30 - Prob. 21PSCh. 30 - Prob. 22PSCh. 30 - Prob. 23PSCh. 30 - Prob. 24PSCh. 30 - Prob. 25PSCh. 30 - Money-market yields In Section 30-4 we described a...Ch. 30 - Money-market yields Look again at the previous...Ch. 30 - Prob. 29PSCh. 30 - Prob. 30PSCh. 30 - Prob. 31PSCh. 30 - Prob. 33PS
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Similar questions
- In the credit terms 1/10, n/30, what does the "1" represent? Group of answer choices number of days when the entire amount is due number of days in the discount period full amount of the invoice 1% cash discount if paid within the credit periodarrow_forwardIf NetSolutions sells a customer some products on account (accounts receivable) and offers a discount for early payment of the customers accounts receivable within the credit period, the discount is called a _________________________________. Group of answer choices trade discount purchases discount sales discount sales allowancearrow_forwardThe type of cash discount where the discount period is counted from the date of invoice is ___. a. Ordinary dating b. Credit period c. Receipt of goods d. End of the montharrow_forward
- 1-what is the average amount of receivables؟ 2-what is the percentage cost of trade credit to customers who take the discount ?arrow_forwardWhich of the following would not result in a reduction of the amount invoiced to a customer when a credit sale is made? A. Quantity discount B. Cash-free discount C. Sales discountD. Two-for-one specialarrow_forwardWhich of the following statements is correct about credit period? A. If a customer purchases goods within the credit period, a cash discount will be allowed to the customer B. If a customer settles the payment within the credit period, a cash discount will be allowed to the customer C. It refers to the period in which customers must settle their debts due D. It refers to the period in which customers need to settle one-third of the debts in order to avoid further interests chargedarrow_forward
- Multiple Choice Questions Which of the following items decreases the balance in the accounts receivable? Cash paid to creditors Discounts received Credit sales discount allowedarrow_forwardThis module discusses discounts given out to customers based on payment terms, such as 2/10, n/30. : What would the credit terms 3/15, n/45 stand for? Explain why it is important for a company to keep track of how much money in discounts is given out? What account is used to track discounts? From a business owner's point of view, what are the advantages of allowing discounts? From a business owner's point of view, what are the disadvantages of allowing discounts?arrow_forwardThe cash discount (also known as purchase discount) is given to customers for a. Frequent purchases b. Bulk purchase c. Early and prompt payments d. Frequent salesarrow_forward
- What is a credit card’s grace period? A) it is the amount of time after a purchase and before it starts accruing interest B) it is a period during which the card’s interest rate cannot change C) it is the amount of time between the bill being issued and your payment being due D) it is the period during which you can return the card and not incur any feesarrow_forwardThe total of settlement discount granted column in cash receipts journal will be posted to the...in general ledger Options to choose from: 1. A debit side of the settlement discount granted account 2. Credit side of the sales returns account 3. Credit side of the credit losses account 4. Debit side of the sales returns account 5. Credit side of the settlement discount granted accountarrow_forwardFor the following transactions, show which Balance Sheet line items will be affected and if the effect will result in the line item increase or reduction. • Purchase a Treasury Bill for cash• Client withdraws savings• Receive a donation• A current loan becomes past due• Purchase motorcycle for staff with short-term creditarrow_forward
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