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The Managment of XYZ has annual credit sales of 2 0 million usd and account receivables of 4 million usd. working capital is financed by

The Managment of XYZ has annual credit sales of

20

million usd and account receivables of

4

million usd. working capital is financed by an overdraft of

12 %

interest per year. assume

365

days in a year

,

what is the annual finance cost saving if the manegment reduces the collection period to

60

days?

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