O $90,000 O $105,000 O $82,500 O$99,000 ustomer paid off the account after 15 days, Sombra Corp. would receive mately 35% of Sombra Corp.'s customers take advantage of the discount and pay on the 10th day. The remaining 65% take pay off their accounts. What is Sombra Corp.'s days sales outstanding (DSO), or the average collection period? O24.94 days O27.56 days O 28.88 days
O $90,000 O $105,000 O $82,500 O$99,000 ustomer paid off the account after 15 days, Sombra Corp. would receive mately 35% of Sombra Corp.'s customers take advantage of the discount and pay on the 10th day. The remaining 65% take pay off their accounts. What is Sombra Corp.'s days sales outstanding (DSO), or the average collection period? O24.94 days O27.56 days O 28.88 days
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Effective credit management involves establishing credit standards for extending credit to customers, determining the company's credit terms, and
setting up procedures for invoicing and collecting past-due accounts.
The following statement refers to a credit management policy. Select the best term to complete the sentence.
The conditions of the credit sale, including cash discounts and due dates, are indicated by the company's credit standards
Consider the case of Sombra Corp.:
Sombra Corp. has a very attractive credit policy, and none of its customers pays in cash when the firm makes a sale. Sombra Corp. sells
to its customers on credit terms of 1/10, net 30.
If a customer bought $100,000 worth of goods and paid the firm cash eight days after the sale, how much cash would Sombra Corp. get from the
customer?
$90,000
O $105,000
$82,500
$99,000
If the customer paid off the account after 15 days, Sombra Corp. would receive
Approximately 35% of Sombra Corp.'s customers take advantage of the discount and pay on the 10th day. The remaining 65% take an average of 35
days to pay off their accounts. What is Sombra Corp.'s days sales outstanding (DSO), or the average collection period?
O 24.94 days
O 27.56 days
28.88 days
26.25 days
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