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Garcia Heating & Air Conditioning tries to take advantage of cash discounts even if it must borrow the money for a few days in
Garcia Heating & Air Conditioning tries to take advantage of cash discounts even if it must borrow the money for a few days in order to pay the invoice in time. Compute the savings on Garcia's purchases and terms from the supplier. Use a 360-day year. Assume that the number of interest days is the time between the due date and the last date to take advantage of the cash discount. Interest Rate Days Amount Cash on of of Invoice Terms Discount Loan Interest Interest Savings $1,200 1/10, n/25 8%
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