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Colt1911 [192]
3 years ago
7

"if rubash corporation bought on terms of 1/10, net 30, what would be its nominal annual cost of costly trade credit? assume a 3

65-day year."
Business
1 answer:
pickupchik [31]3 years ago
4 0
<span>Answer:
   Corporation don't want to take discount then pay bill in within 30 days. Nominal annual cost of trade credit Formula for Trade Credit = (365/Days Credit -Discounting Period ) * (Discount % / 1 - Discount %) Step 1 Here Cost of Credit = (365/30- 10) * (1/100-1) Step 2 = (18.25 * 0.01 )% Final Answer = 18.25% 12.17% is the cost of not taking discount to Rubash Corporation. Annual cost of costly trade credit: Here 10 Days discount period occurs 36.5 times per year. Effective Annual Credit cost = [1 + (Credit..</span>
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