MLX has annual sales of $320 million per year and has calculated the collection float to be 12 days. If MLX is currently paying 9.35% on its line of credit, what amount of interest expense could be saved if the collection float is reduced by 3 days? (Assume 365 days per year.)
MLX has annual sales of $320 million per year and has calculated the collection float to be 12 days. If MLX is currently paying 9.35% on its line of credit, what amount of interest expense could be saved if the collection float is reduced by 3 days? (Assume 365 days per year.)
Chapter17: The Management Of Cash And Marketable Securities
Section: Chapter Questions
Problem 1P
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![Short-term Financial
agement (2"
MLX has annual sales of $320 million per year and has calculated the collection
float to be 12 days. If MLX is currently paying 9.35% on its line of credit, what
amount of interest expense could be saved if the collection float is reduced by
3 days? (Assume 365 days per year.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3ef5bf05-a3ce-4e88-8c95-aec2d1a97bdd%2F1807ee81-b750-44f2-a771-f227135e7612%2F8olfdq4_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Short-term Financial
agement (2"
MLX has annual sales of $320 million per year and has calculated the collection
float to be 12 days. If MLX is currently paying 9.35% on its line of credit, what
amount of interest expense could be saved if the collection float is reduced by
3 days? (Assume 365 days per year.)
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