Company X sells on a 1/15, net 60, basis. Customer Y buys goods with an invoice

Question

Company X sells on a 1/15, net 60, basis. Customer Y buys goods with an invoice of $1,500. a. How much can company Y deduct from the bill if it pays on day 15? Discount $ b. How many extra days of credit can company Y receive if it passes up the cash discount? Number of days days c. What is the effective annual rate of interest if Y pays on the due date rather than day 15? (Use 365 days in a year. Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Effective annual rate %

Explanation / Answer

1) Discount = 1500*1% i.e 15

2) 45 days  

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.