Q1. Bing Inc. buys on terms of 4/10, net 45. It does not take the discount, and it generally pays after 65 days. What is the effective (not nominal) annual percentage cost of its non-free trade credit, based on a 365-day year?

Q2. Polygon inc. is preparing its cash budget and expects to have sales of $450,000 in January, $375,000 in February, and $555,000 in March.If 20% of the sales are for cash, 45% are credit sales paid in the month after the sale, and another 35% are credit sales paid 2 months after the sale, what are the expected cash receipts for March?

2A. Base on Q2, Polygon assumed that all credit sales were paid in full, which is not realistic.Polygon studied its past credit sales and determined that 3.25% of its credit sales resulted in Bad Debts that were never collected.Using the data from the previous problem with the new assumption that 3.25% of credit sales were never collected, what is your revised estimate for the expected cash receipts for March?

2B. Base on Q2, Polygon assumed that all credit sales were paid in full, with no bad debt expense.For this problem, please assume that bad debt expense is again 0% for Polygon.Purchases for next month's sales are 50% of projected sales for the next month, and April sales are estimated to be $495,000; purchases for April are paid in cash in March."Other payments," which include wages, rent, and taxes, are 25% of sales for the current month. Construct a cash budget for March using your expected cash receipts from problem Q2 and calculate the average net cash flow during the month of March.