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$2,000,000 order, 30-day credit terms VCR (0.30) = Variable cost ratio/$ of sales EXP (0.05/CP) = Expenses for credit administration and collection/$ of sales I
- $2,000,000 order, 30-day credit terms
- VCR (0.30) = Variable cost ratio/$ of sales
- EXP (0.05/CP) = Expenses for credit administration and collection/$ of sales
- I (0.10/365) = Daily interest rate
- CP (45 days) = Collection period for sale
- Calculate the present value of this sales using PV=invoice price (1-d)/(1+(i/365)(day)
- Calculate the NPV of this sale using Npv= S-ExP(s)/1+icp - VCR(S)
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
