The March 31, 1999, issue of The Wall Street Journal includes an article by Mark ©

Maremont entitled “Store Markdowns: Leaning on Suppliers, Rite Aid Deducts Cash at Bill-Paying Time.” The September 9, 1999, issue includes another article by the same writer entitled “Rite Aid Repays Some Disputed Deductions from Vendors’ Bills.”

Instructions Read the articles and answer the following questions:

(a) What reasons did Rite Aid give for reducing the amount it paid its suppliers?

(b) Other than its stated reason for reducing its payments, what other incentives might Rite Aid have had for reducing the amount paid to its suppliers?

(c) What are the implications of Rite Aid’s actions for the suppliers? What are the suppliers’ possible courses of action?

(d) Why do you suppose Rite Aid eventually chose to repay these bills?