A company with export sales of $480m pa has an average collection period of 3 months,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
A company with export sales of $480m pa has an average collection period of 3 months, bad debts are 2%. A factoring company will provide non-recourse factoring for a fee of 5% of revenue. As a result of this, administration savings will be made of £8m p.a. and the credit period will fall to 2 months. The company has a cost of capital of 10%, and the exchange rate is currently 2 $/£. Required Assess, in £s, whether the factor should be used. A company with export sales of $480m pa has an average collection period of 3 months, bad debts are 2%. A factoring company will provide non-recourse factoring for a fee of 5% of revenue. As a result of this, administration savings will be made of £8m p.a. and the credit period will fall to 2 months. The company has a cost of capital of 10%, and the exchange rate is currently 2 $/£. Required Assess, in £s, whether the factor should be used. A company with export sales of $480m pa has an average collection period of 3 months, bad debts are 2%. A factoring company will provide non-recourse factoring for a fee of 5% of revenue. As a result of this, administration savings will be made of £8m p.a. and the credit period will fall to 2 months. The company has a cost of capital of 10%, and the exchange rate is currently 2 $/£. Required Assess, in £s, whether the factor should be used. A company with export sales of $480m pa has an average collection period of 3 months, bad debts are 2%. A factoring company will provide non-recourse factoring for a fee of 5% of revenue. As a result of this, administration savings will be made of £8m p.a. and the credit period will fall to 2 months. The company has a cost of capital of 10%, and the exchange rate is currently 2 $/£. Required Assess, in £s, whether the factor should be used.
Expert Answer:
Answer rating: 100% (QA)
In order to assess whether the factor should be used we n... View the full answer
Related Book For
Posted Date:
Students also viewed these general management questions
-
Rowntown Cab Company has 70 drivers that it must schedule in three 8-hour shifts. However, the demand for cabs in the metropolitan area varies dramatically according to the time of day. The slowest...
-
The Rowntown Cab Company has 26 cabs. The local manager wants to conduct a work sampling study to determine what proportion of the time a cab driver is sitting idle, which he estimates is about 30%....
-
Model 8 has fairly high profit margins, but it isnt included at all in the optimal mix. Use Solver Table, along with some experimentation on the correct range, to find the (approximate) selling price...
-
Estimate the errors involved in Exercise 63, parts (a) and (b). How large should be in each case to guarantee an error of less than 0.00001?
-
For the standard normal distribution, what does z represent?
-
Recall from Example 2 that seven-year Greek government bonds issued in 2020 with a 2.00 percent annual coupon had a price of EUR93.091 per EUR100 principal two years later. 1. What is the implied...
-
How many months does it take to save $200,000.00 based on the information provided in this problem?---
-
Larson entered into a Special Manager Incentive Agreement (SMIA) with Tandy Corp. He agreed to manage a Radio Shack store for compensation equal to one-half of the adjusted gross profit of the store...
-
L K N H Consider the graph given above. a. How many vertices does the graph have? b. What is the degree of vertex M? c. What is the degree of vertex K? d. How many connected components does the graph...
-
Three professors examined awareness of four widely disseminated retirement rules among employees at the University of Utah. These rules provide simple answers to questions about retirement planning...
-
(4) Given h=200 W/(m-K), h = 100 W/(m K), ,, - 120 C, 1,2 = 20 C, = 8=1 m, 1=0.985 W/(m K), A- 200 m. Find the overall heat-transfer coefficient, thermal resistance per area and total heat transfer...
-
True or False. Lagrange's equation cannot be used to derive the equations of motion of a multi-degree-of-freedom system.
-
A mass of \(110 \mathrm{~kg}\) is hung from a spring in a local gravitational field where \(g=9.806 \mathrm{~m} / \mathrm{s}^{2}\), and the spring is found to deflect by \(30 \mathrm{~mm}\). If the...
-
True or False. For a multi-degree-of-freedom system, one equation of motion can be written for each degree of freedom.
-
Matthew (who was born on 1 October 1934) dies on 23 December 2023. His only income in tax year 2023-24 is a retirement pension of 35,130. He made a Gift Aid donation of 200 in July 2023. His wife has...
-
True or False. The product of stiffness and flexibility matrices of a system is always an identity matrix.
-
27) The corporate charter of Torres Corporation allows the issuance of a maximum of 4,000,000 shares of $1 par value common stock. During its first three years of operation, Torres issued 2,080,000...
-
What is removed during each of the three stages of wastewater treatment: primary, secondary, and tertiary? During which state would you expect items to be recovered that were accidentally flushed,...
-
Solve the linear programming model formulated in Problem 31 for Prissy Paulines Barbecue Restaurant using the computer. a. If the restaurant could get additional pork or beef from the meat supplier,...
-
The Metropolitan Police Department was recently criticized in the local media for not responding to police calls in the downtown area rapidly enough. In several recent cases, alarms had sounded for...
-
A tailor makes wool tweed sport coats and wool slacks. He is able to get a shipment of 150 square yards of wool cloth from Scotland each month to make coats and slacks, and he has 200 hours of his...
-
Affordable Art Company has a Print Division that is currently producing 100,000 prints per year but has a capacity of 150,000 prints. The variable costs of each print are \($28\), and the annual...
-
The Stallion Division of Motortown Motors had an operating income of \($675,000\) and net assets of \($2,700,000\). Motortown Motors has a target rate of return of 23 percent. Required a. Compute the...
-
The Worldwide Auditors Association is a professional association. Its current membership totals 97,600 worldwide. The association operates from a central headquarters in New Zealand but has local...
Study smarter with the SolutionInn App