Little Kimi Clothiers can borrow from its bank at 13 percent to take a cash discount. The terms of the cash discount are 3/25 net 85.

a. Compute the cost of not taking the cash discount. (Use 365 days in a year. Do not round the intermediate calculations. Round the final answer to 2 decimal places.)

Cost of not taking a cash discount %

b. Should the firm borrow the funds?

• No

• Yes