Effective credit policy involves establishing credit standards for extending credit to customers, determining the company's terms of credit, and setting up procedures for invoicing and collecting past-due accounts. The following statement refers to a credit management policy. Select the best term to complete the sentence. The minimum financial strength a customer must have to be granted credit is indicated by the company's credit terms collection policy credit standards Consider the case or Stowe-Arts Holdings Co.: Stowe-Arts Holdings Co. has a very attractive credit policy, and none of its customers pay in cash when the firm makes a sale. Stowe-Arts Holdings Co. sells to its customers on credit terms of 2/10, net 30. If a customer bought $125,000 worth of goods and paid the firm cash eight days after the sale, how much cash would Stowe-Arts Holdings Co. get from the customer? $100,000 $122,500 $125,000 $109,375 If the customer paid off the account after 15 days, how much cash would Stowe-Arts Holdings Co. get? Approximately 30% of Stowe-Arts Holdings Co.'s customers take advantage of the discount and pay on the 10th day. The remaining 70% take an average of 35 days to pay off their accounts. What is Stowe-Arts Holdings Co.'s days sales outstanding (DSO), or the average collection period? O O O 31.6 days 27.5 days 33.0 days 28.9 days