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    Receivables Investment & Cost of Trade Credit

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    Receivables Investment
    Medwig Corporation has a DSO of 17 days. The company averages $3,500 in credit sales each day. What is the company's average account receivable?

    Cost of Trade Credit
    What is the nominal and effective cost of trade credit under the credit terms of 3/15, net 30?

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    https://brainmass.com/business/receivables/receivables-investment-cost-trade-credit-108514

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    HOMEWORK PRACTICE PROBLEM

    Cash Management

    Williams & Sons last year reported sales of $10 million and an inventory turnover ratio of 2. The company is now adopting a new inventory system. If the new system is able to reduce the firm's inventory level and increase the firm's inventory ratio to 5, while maintaining the same level of sales, ...

    Solution Summary

    This solution explains how to calculate a company's average accounts receivable and the nominal and effective cost of trade credit in a fully formatted Word attachment.

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