(Evaluating trade credit discounts) (Related to Checkpoint 18.2 on page 621) Your company makes a product that...

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(Evaluating trade credit discounts) (Related to Checkpoint 18.2 on page 621)

Your company makes a product that has a cash conversion cycle of 50 days. Your cash requirement is £250,000 and your interest cost is 4.5 percent. You have just offered a customer a 2 percent discount to pay an invoice of £20,000 10 days early.

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Muhammad Salman Alvi

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