hello, can u give correct answer What is the nominal cost of trade creditif the terms are 4/10, net 45 assumingthat customers forego the discount andpay on the 45th day? (365 in year)Answer: 43.45%

Nominal cost of trade credit = ((Discount rate)/(1-Discount rate))*((365/(Payment period-Discount…

Answered: What is the nominal cost of trade…

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter16: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 8P

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If a firm buys on terms of 3/15, net 45, but actually pays on the 20th day and still takes the discount, what is the nominal cost of its nonfree trade credit? Does it receive more or less credit than it would if it paid within 15 days?
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What is the nominal cost of trade credit if the terms are 4/10, net 45 assuming that customers forego the discount and pay on the 45th day? (365 in year) Need solution
What is the nominal cost of trade credit if
What is the nominal cost of trade credit if the terms are 4/10, net 45 assuming that customers forego the discount and pay on the 45th day? (365 in year) Financial Accounting
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What is the nominal cost of trade credit if the terms are 4/10, net 45 assuming that customers forego the discount and pay on the 45th day? (365 in year) Answer: 43.45%