Final-TakeHome-Chapter-16.doc

Final-TakeHome-Chapter-16.doc - 1 Tangshan Mining was...

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1. Tangshan Mining was extended credit terms of 3/15 net 30 EOM. The cost of giving up the cash discount, assuming payment would be made on the last day of the credit period, would be 2) Tangshan Mining was extended credit terms of 3/15 net 30 EOM. The cost of giving up the cash discount, assuming payment would be made on the last day of the credit period, is 75.26 percent. If the firm were able to stretch its accounts payable to 60 days without damaging its credit rating, the cost of giving up the cash discount would only be 3) Tangshan Mining was extended credit terms of 3/15 net 30 EOM. The cost of giving up the cash discount, assuming payment would be made on the last day of the credit period, would be ________. If the firm were able to stretch its accounts payable to 60 days without damaging its credit rating, the cost of giving up the cash discount would only be ________. 4) A firm purchased goods with a purchase price of $1,000 and credit terms of 1/10 net 30. The firm paid for these goods on the 5th day after the date of sale. The firm must pay ________ for the goods. 5) A firm purchased goods on January 27 with a purchase price of $1,000 and credit terms of 2/10 net 30 EOM. The firm paid for these goods on February 9. The firm must pay ________ for the goods. 6) The cost of giving up a cash discount under the terms of sale 1/10 net 60 (assume a 360-day year) is 7) The cost of giving up a cash discount under the terms of sale 5/20 net 120 (assume a 360-day year) is 8) Ashley's Delivery Service is analyzing the credit terms of each of three suppliers, A, B, and C.
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