Cash discount versus loan

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Reference no: EM131625102

Cash discount versus loan Joanne Germano works in an accounts payable department of a major retailer. She has attempted to convince her boss to take the discount on the 1/ 15 net 45 credit terms most suppliers offer, but her boss argues that giving up the 1% discount is less costly than a short-term loan at 10%. Prove to whoever is wrong that the other is correct. (Note: Assume a 365-day year.)

The cost of giving up the cash discount is | %. (Round to two decimal places.)

Reference no: EM131625102

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