24. Denver Tiles Inc. is considering factoring its receivables. The company's average collection period is 60 days, and its average level of receivables is $500,000, The factor has indicated that it requires reserve for returns and allowances and charges a 1.0% factoring com be paid up front. The factor will advance Denver Tiles funds at 2. lending rate, which is currently 3.75%. Inte advanced by the factor and the effective annual rate of the factoring. a 15% mission, with the commission to over the prime 25 percentage points rest is to be paid up front. Determine the net amount Answers: Net amount advanced by factor Effective annual rate of the loan