Estimate the dollar amount you would receive

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Question - Assume the operation of your business resulted in sales of $730,000 last year. Year-end receivables are $100,000. You are considering factoring the receivables to raise cash to help finance your venture's growth. The factor imposes a 7 percent discount and charges an additional 1 percent for each expected ten-day average collection period over thirty 30 days.

Estimate the dollar amount you would receive from the factor for your receivables if the collection period was thirty 30 days or less. You must show the math (formula) that led to the answer to this question. Showing the answer alone without the formula is not acceptable.

Reference no: EM132940324

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