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Central Sdn Bhd has three possible suppliers, all of which offer different credit terms. Except for the differences in credit terms, their products and services

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Central Sdn Bhd has three possible suppliers, all of which offer different credit terms. Except for the differences in credit terms, their products and services are virtually identical. The credit terms offered by these suppliers are shown in the following table. Assume a 365-day per year. (Note: round your answer to the nearest 2 decimal digits) Supplier Credit terms Q1 1.5/10 net 30 End of the month (EOM) Q2 2/6 net 30 EOM Q3 1/4 net 25 EOM Required: Determine the approximate cost of giving up the cash discount from each supplier. (6 marks) Assuming that the company needs short-term financing, indicate whether it would be better to give up the cash discount or take the discount and borrow from a bank at 18% annual interest. Evaluate each supplier separately using your findings in part 1. (3 marks) Briefly discuss the impact if the company could stretch its account payable by 20 days from supplier Q1

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