Tan Co. has a very attractive credit policy, and none of its customers pays in cash when the firm makes a sale. Tan Co. sells to its customers on credit terms of 3/10, net 30.

If a customer bought $150,000 worth of goods and paid the firm cash eight days after the sale, how much cash would Tan Co. get from the customer?

$145,500

$123,750

$135,000

$150,000

If the customer paid off the account after 15 days, Tan Co. would receive

$135,000

150,000

123,750

145,500

Approximately 35% of Tan Co.s customers take advantage of the discount and pay on the 10th day. The remaining 65% take an average of 35 days to pay off their accounts. What is Tan Co.s days sales outstanding (DSO), or the average collection period?

26.25 days

24.94 days

21.00 days

28.88 days