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%
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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?hat are the nominal and effective costs of trade credit under the credit terms of 2/20, net 40? Assume a 365-day year. Do not round intermediate calculations. Round your answers to two decimal places. Nominal cost of trade credit: % Effective cost of trade credit:Provide solution for this question
- On a 365-day basis, what is the rate per period of using trade credit if terms are 2/10, net 30, and payment is made on the twentieth day? * 104% 2.04% 109% 10% 1.09% On a 365-day basis, what is the effective annual rate of using trade credit if terms are 2/10, net 30, and payment is made on the twentieth day? * 1.09% 2.04% 109% 10% 104%5. A firm is offered trade credit terms of 3/15, net 45 days. The firm does not take the discount, and it pays after 67 days. What is the nominal annual cost of not taking the discount? (Assume a 365-day year.) A. 21.71% C. 22.95% E. 24.52% B. 22.07% D. 23.48%14. Trade credit terms of 2/10, net 90 are available. Calculate the cost of trade credit when payment is made on the net due date using the EAR (also known as APY). Use a 360 day year.
- 2 (TCO C) Your company has been offered credit terms of 4/30, net 90 days. What will be the nominal annual percentage cost of its nonfree trade credit if it pays 120 days after the purchase? (Assume a 365-day year.) a. 16.05% b. 16.90% c. 17.74% d. 18.63% e. 19.56%A firm buys on terms of 3/15, net 45. It does not take the discount, and it generally pays after 60 days. What is the nominal annual percentage cost of its non-free trade credit, based on a 365-day year? 36.73% 25.09% 33.39% 27.59% 30.35%Cost of Trade Credit If a firm buys under terms of 1/15, net 60, but actually pays on the 20th day and still takes the discount, what is the nominal cost of its nonfree trade credit? Assume a 365-day year. Do not round intermediate calculations. Round your answer to two decimal places. % Does it receive more or less credit than it would if it paid within 15 days? I. Paying before the discount period and taking the discount gives the firm more credit than it would receive if it paid within 15 days.II. Paying after the discount period, but still taking the discount gives the firm more credit than it would receive if it paid within 15 days.III. Paying after the discount period, but still taking the discount gives the firm less credit than it would receive if it paid within 15 days. -Select-IIIIII
- Cost of Trade Credit If a firm buys under terms of 1/15, net 45, but actually pays on the 20th day and still takes the discount, what is the nominal cost of its nonfree trade credit? Assume a 365-day year. Do not round intermediate calculations. Round your answer to two decimal places. % Does it receive more or less credit than it would if it paid within 15 days? I. Paying after the discount period, but still taking the discount gives the firm more credit than it would receive if it paid within 15 days. II. Paying after the discount period, but still taking the discount gives the firm less credit than it would receive if it paid within 15 days. III. Paying before the discount period and taking the discount gives the firm more credit than it would receive if it paid within 15 days.# 17 If credit terms of "2/10, net 40" are offered, the approximate cost of not taking the discount and paying at the end of the credit period would be (Assume a 365-day year) Answer O 20.8 percent O 22.8 percent O 24.8 percent O 23.8 percent13. Trade credit terms of 2/10, net 90 are available. Calculate the cost of trade credit when payment is made on the net due date using the APR. Use a 360 day year.
