Discounts. Martha Zeeman Clinic (Exhibit 5.16) is going to take better advantage of credit terms offered by suppliers. The clinic has negotiated a 3 percent discount for all supplies purchased beginning in 20X1, if paid in full during the month of service with the credit terms listed below. How does this change the answer to problem 43?

Timing of payment for 20X0 supply purchases 55 percent: month purchased 30 percent: first prior month 10 percent: second prior month 5 percent: third prior month

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EXHIBIT 5.16 MARTHA ZEEMAN CLINIC Givens Revenues Patient Revenues, 20X0 Patient Revenues, 20X0 Estimated Patient Revenues, 20X1 July $4,500,000 October $4,420,000 January $4,600,000 August $4,350,000 November $4,210,000 February $4,350,000 September $4,530,000 December $4,800,000 March $4,220,000 Other Revenues, 20X1 Receipt of Payment for Patient Services / Revenues January $98,000 Current month of service 45% February March $130,000 1st month of prior service 25% $125,000 2nd month of prior service 10% 3-6 months of prior service 5%