Hi,

I need assistance on question below:

Emilio and Ren Santos own Club Metlock. From its inception, Club Metlock has sold merchandise on either a cash or credit basis, but no credit cards have been accepted. During the past several months, the Santos have begun to question their credit-sales policies. First, they have lost some sales because of their refusal to accept credit cards. Second, representatives of two metropolitan banks have convinced them to accept their national credit cards. One bank, Business National Bank, has stated that (1) its credit card fee is 5% and (2) it pays the retailer 96 cents on each $1 of sales within 3 days of receiving the credit card billings. The Santos decide that they should determine the cost of carrying their own credit sales. From the accounting records of the past 3 years, they accumulate these data: Credit and collection expenses as a percentage of net credit sales are as follows: uncollectible accounts 1.8%, billing and mailing costs 0.5%, and credit investigation fee on new customers 0.2% Emilio and Ren also determine that the average accounts receivable balance outstanding during the year is 5% of net credit sales. The Santos estimate that they could earn an average of 10% annually on cash invested in other business opportunities. Answer the following. Prepare a tabulation for each year showing total credit and collection expenses in dollars and as a percentage of net credit sales. (Round percentage values to 1 decimal place, e.g. 52.7\%.)