Question
Mr. Hugh Warner is a very cautious businessman. His supplier offers trade credit terms of 3/11, net 85. Mr. Warner never takes the discount offered,
Mr. Hugh Warner is a very cautious businessman. His supplier offers trade credit terms of 3/11, net 85. Mr. Warner never takes the discount offered, but he pays his suppliers in 75 days rather than the 85 days allowed so he is sure the payments are never late. What is Mr. Warner's cost of not taking the cash discount?
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Financial Institutions Management
Authors: Anthony Saunders
3rd Edition
007303259X, 978-0073032597
