2) Trade credit terms of 1.5/10 net 45 are offered. What is the annualized cost of missing the trade credit discount?

a) 24.83% b) 22.58% c) 21.28% d)18.53% e) 15.88%

3) Credit terms of 5/7, net 30 implies that if payments are made in ______ days a cash discount of _______% may be taken.

a) 7, 5 b) 5, 7 c) 5, 30 d) 7, 30 e) 15, 45

4) Use Table 1. What is the Payment Index (round up to a whole number)?

	Credit Sales	Uncollected Amount
January	$100,000	$10,000
February	125,000	15,000
March	150,000	25,000
April	175,000	60,000

a) 127% b) 80% c) 73% d) 64% e) 52%