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Sammy Sausage makes the majority of his sales of Snag Sandwiches on credit. In 2021 it took on average 40 days for these credit customers

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Sammy Sausage makes the majority of his sales of Snag Sandwiches on credit. In 2021 it took on average 40 days for these credit customers to pay Sammy back. This is an increase from 30 days in 2020. (a) Identify the trend in Accounts Receivable Tumover (the time it takes for your credit customers to settle their debts).. [1 mark] [TYPE HERE) (b) Define liquidity. Explain why this trend could negatively impact the business' liquidity. [2 marks] [TYPE HERE) (c) Identify one strategy Sammy's business might implement to get their credit customers to pay them back quicker. [1 mark] [TYPE HERE) Sammy is considering offering a discount to credit customers by introducing the following credit terms (2/7 n/30). (d) Identify one advantage and one disadvantage of implementing this strategy. [2 marks] [TYPE HERE) Sammy is concerned that his suppliers based in Melbourne are increasingly introducing price increases. After some extensive research, he has discovered that he can save between 20-30% on the cost price of his snags if he purchases from newly created wholesale suppliers based in South-East Asia. (e) Identify two advantages that Sammy might expect to experience if he chooses to use the overseas supplier [2 marks] [TYPE HERE) () Identify two disadvantages that Sammy might expect to experience if he chooses to use the overseas supplier. [2 marks] [TYPE HERE)

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