Question
The Tropeland Company has obtained the following information: Annual Credit sales: $ 30 million Collection period: 60 days Terms: Net 30 Interest Rate: 12% The
The Tropeland Company has obtained the following information:
Annual Credit sales: $ 30 million
Collection period: 60 days
Terms: Net 30
Interest Rate: 12%
The company is considering offering terms of 4/10 net30. It anticipates that 50% of its customers will take advantage of the discount. The collection period is expected to decrease by one month.
Should the new credit policy be adopted?
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Cost Accounting
Authors: William K. Carter
14th edition
759338094, 978-0759338098
