FREE Trial
Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The management of XYZ Co has annual credit sales of $20m and accounts receivable of $4m. Working capital is financed by an overdraft at 12%

The management of XYZ Co has annual credit sales of $20m and accounts receivable of $4m. Working capital is financed by an overdraft at 12% interest per year. Assume 365 days in a year. What is the annual finance cost saving if the management reduces the collection period by 60 days?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Research Methods For Accounting And Finance Global Management Series

Research Methods For Accounting And Finance Global Management Series

Authors: Audrey Paterson, Kevin D. Ogorman, David Leung, Robert Macintosh, William Jackson

1st Edition

1910158895, 978-1910158890

More Books

Students also viewed these Accounting questions

Question

★★★★★
By law, food servers at restaurants are not entitled to minimum wages since they are tipped by customers. Can food servers increase their tips by complimenting the customers they are waiting on? To...

Answered: 1 week ago

Question

★★★★★
Does our physical environment differ from that of the study unit?

Answered: 1 week ago

Question

★★★★★
Identify two assumptions that traditional financial models make about individual investment behavior and discuss their impact.

Answered: 1 week ago

Question

★★★★★
In our Feature Story about Super Bakery, Inc., we described a virtual corporation as one that consists of a core unit that is supported by a network of outsourced activities. A virtual corporation...

Answered: 1 week ago

Question

★★★★★
Entries related to Uncollectible Accounts 2. b. Post each entry that affects the following T accounts and determine the new balances: 3. Determine the expected net rnalizable valub of the accolints...

Answered: 1 week ago

Question

★★★★★
the cost of 5 gallons of ice cream has a standard deviation of 6 dollars with a mean of 32 dollars during the summer. what is the probability that the sample mean would be less that 33.3 dollars if a...

Answered: 1 week ago

Question

★★★★★
Problems 1.On 8.23.17, the night before the Powerball lottery results were announced, a man posted ( and then deleted) the following Tweet: "If I win, 10 people who RT this tweet will get $1,000,000...

Answered: 1 week ago

Question

★★★★★
Abigail has three children - Ben who is a toddler aged 2, Marie who is aged 8, and a 15 year old named Josh. Abigail lives in a deteriorating two bedroom apartment in a crime ridden part of town. She...

Answered: 1 week ago

Question

★★★★★
As part of its internal analysis, an HR manager at a consumer products firm is asked to prepare a forecast for the supply of product managers over the next year. Which of these techniques would...

Answered: 1 week ago

Question

★★★★★
Huntington Boards manufactures two models of surfboards, Basic and Competition, in a facility in Southern California. In fabrication, machine setup costs are driven by the number of setups, machine...

Answered: 1 week ago

Question

★★★★★
Mary Ann bought a new computer for $2,000 and financed the entire purchase price at a nominal rate of interest payable 12 times per year at 9% per annum. She repaid her loan in 4 years with 48 equal...

Answered: 1 week ago

Question

★★★★★
Name and explain the issue underlying the pay gap between Roger and Bianca.

Answered: 1 week ago

Question

★★★★★
Define indirect financial compensation (employee benefits).

Answered: 1 week ago

Question

★★★★★
Do you feel that David was justified in insisting that the job, not the person, be evaluated? Discuss.

Answered: 1 week ago

Previous Question Next Question