400:49:38Your firm has an average collection period of 38 days. Current practice is to factor allreceivables immediately at a discount of 1.9 percent. Assume that default is extremelyunlikely. What is the effective cost of borrowing? (Do not round intermediatecalculations and enter your answer as a pecent rounded to 2 decimal places, e.g.,32.16.)Effective cost of borrowing19.82 % 5ts00:50:01SkippedeBookHintPrinteferencesSexton Corporation has projected the following sales for the coming year:Q1Q2Q3Q4Sales $970 $1,050 $1,010 $ 1,110Sales in the year following this one are projected to be 15 percent greater in eachquarter.a. Calculate payments to suppliers assuming that the company places orders duringeach quarter equal to 30 percent of projected sales for the next quarter. Assume thatthe company pays immediately. (Do not round intermediate calculations and roundyour answers to 2 decimal places, e.g., 32.16.)b. Calculate payments to suppliers assuming a 90-day payables period. (Do not roundintermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)c. Calculate payments to suppliers assuming a 60-day payables period. (Do not roundintermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)a. Payment of accountsb. Payment of accountsc. Payment of accountsQ1Q2Q3Q4

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Your firm has an average collection period of 38 days. Current practice is to factor all receivables immediately at a discount of 1.9 percent. Assume that default is extremely unlikely. What is the effective cost of borrowing? (Do not round intermediate calculations and enter your answer as a pecent rounded to 2 decimal places, e.g., 32.16.) Effective cost of borrowing 19.82 %

Your firm has an average collection period of 38 days. Current practice is to factor all receivables immediately at a discount of 1.9 percent. Assume that default is extremely unlikely. What is the effective cost of borrowing? (Do not round intermediate calculations and enter your answer as a pecent rounded to 2 decimal places, e.g., 32.16.) Effective cost of borrowing 19.82 %

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter21: Supply Chains And Working Capital Management

Section: Chapter Questions

Problem 15P: Suppose a firm makes purchases of $3.65 million per year under terms of 2/10, net 30, and takes...

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