pm.2 Miyagi Data, Inc., sells earnings forecasts for Japanese securities. Its credit terms are3/20, net 40. Based on experience, 65 percent of all customers will take the discount.a. What is the average collection period? (Do not round intermediate calculations andround your answer to 2 decimal places, 32.16.)b. If the company sells 1,250 forecasts every month at a price of $2,350 each, what is itsaverage daily balance sheet amount in accounts receivable? (Do not roundintermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)Answer is complete but not entirely correct.a.Average collection periodb. Average accounts receivable)$17 days1,542,575.34

Credit Term of 3/20, Net 40 shows that buyers will get discount of 3% if payment is made in 20 days…

Answered: Miyagi Data, Inc., sells earnings…

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter22: Providing And Obtaining Credit

Section: Chapter Questions

Problem 4MC

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Miyagi Data, Inc., sells earnings forecasts for Japanese securities. Its credit terms are 1/10, net 50. Based on experience, 75 percent of all customers will take the discount. a. What is the average collection period? Average collection period _________________days b. If the company sells 1,380 forecasts every month at a price of $2,480 each, what is its average daily balance sheet amount in accounts receivable? Average accounts receivable ____________
Miyagi Data, Inc., sells earnings forecasts for Japanese securities. Its credit terms are 3/20, net 40. Based on experience, 65 percent of all customers will take the discount. a. What is the average collection period? (Do not round intermediate calculations and round your answer to 2 decimal places, 32.16.) b. If the company sells 1,250 forecasts every month at a price of $2,350 each, what is its average daily balance sheet amount in accounts receivable? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Answer is complete but not entirely correct. a. Average collection period b. Average accounts receivable) $ 17 days 1,542,575.34
Kyoto Joe, Inc., sells earnings forecasts for Japanese securities. Its credit terms are 2/15, net 90. Based on experience, 80 percent of all customers will take the discount. What is the average collection period for the company? (Use 365 days a year. Do not round intermediate calculations.) If the company sells 1,240 forecasts every month at a price of $1,850 each, what is its average balance sheet amount in accounts receivable? (Use 365 days a year. Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to 2 decimal places, e.g., 1,234, 567.89.) a. Average collection period? daysb. Average balance?
Kirk Development buys on terms of 2/15, net 60 days. It does not take discounts, and it typically pays on time, 60 days after the invoice date. Net purchases amount to $750,000 per year. On average, what is the dollar amount of total trade credit (costly + free) the firm receives during the year, i.e., what are its average accounts payable? (Assume a 365-day year, and note that purchases are net of discounts.)
Kirk Development buys on terms of 2/15, net 45 days. It does not take discounts, and it typically pays on time, 45 days after the invoice date. Net purchases amount to $350,000 per year. On average, what is the dollar amount of total trade credit (costly + free) the firm receives during the year, i.e., what are its average accounts payable? (Assume a 365-day year, and note that purchases are net of discounts.) a. $43,151 b. $14,384 c. $42,288 d. $14,096 e. $28,767
Kyoto Joe, Incorporated, sells earnings forecasts for Japanese securities. Its credit terms are 2/15, net 35. Based on experience, 75 percent of all customers will take the discount. What is the average collection period for the company? If the company sells 2,200 forecasts every month at a price of $900 each, what is its average balance sheet amount in accounts receivable?
Kyoto Joe, Incorporated, sells earnings forecasts for Japanese securities. Its credit terms are 3/20, net 40. Based on experience, 70 percent of all customers will take the discount. Assume 365 days per year. What is the average collection period? Note: Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32. If the company sells 1,370 forecasts every month at a price of $2,470 each, what is its average daily balance sheet amount in accounts receivable? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.
Hinkle Corporation buys on terms of 2/15, net 60 days. It does not take discounts, and it typically pays on time, 60 days after the invoice date. Net purchases amount to $550,000 per year. On average, what is the dollar amount of total trade credit (costly + free) the firm receives during the year, i.e., what are its average accounts payable? (Assume a 365-day year, and note that purchases are net of discounts.) a. $94,932 b. $109,895 c. $90,411 d. $104,662 e. $99,678
A firm buys on terms of 2/15, net 50. It does not take discounts. It pays 60 days after invoice date. Net pruchses amount to $575,000 per year. What is the dollar amount of total trade credit the firm receives during the year i.e. what are its average account payable?
Salma Corporation sells on terms of net/90. Their accounts receivable are on average 20 days past due. If annual credit sales are P800,000, what is the company’s average investment in accounts receivable? choose the letter of correct answera. P44,444.00b. P144,444.00c. P224,444.00d. P244,444.00e. P344,444.00
FP Co. buys on terms 2/10, net 30, but generally does not pay until the 40 days after invoice date. Its purchases total P2,160,000 per year. Assuming 360 days a year, the amount of “non-free” trade credit used by the firm on the average each year is? Hint: Non-free trade credit = Amount of Discount/Cost of Trade Credit 180,000 OR 60,000?
McEwan Industries sells on terms of 3/10, net 20. Total sales for the year are $971,000; 40% of the customers pay on the 10th day and take discounts, while the other 60% pay, on average, 90 days after their purchases. Assume 365 days in year for your calculations. What is the days sales outstanding? Round your answer to two decimal places. days What is the average amount of receivables? Do not round intermediate calculations. Round your answer to the nearest cent. $ What is the percentage cost of trade credit to customers who take the discount? If your answer is zero, enter zero. Round your answer to two decimal places. % What is the percentage cost of trade credit to customers who do not take the discount and pay in 90 days? If your answer is zero, enter zero. Do not round intermediate calculations. Round your answers to two decimal places. Nominal cost: % Effective cost: % What would happen to McEwan’s accounts receivable if it toughened up on its collection…

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