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Question: Dome Metals has credit sales of $342,000 yearly with credit terms of net 45 days, which is also the average collection period. Assume the firm adopts new credit terms of 2/18, net 45 and all customers pay on the last day of the discount period. Any reduction in accounts receivable will be used to reduce the firm's bank loan which costs 10 percent. The new credit terms will increase sales by 10% because the 2% discount will make the firm's price competitive. a. If Dome earns 20 percent on sales before discounts, what will be the net change in income if the new credit terms are adopted? (Use a 360-day year.)
b. Should the firm offer the discount?
Calculate the value of the two accounts at the end of one year, and recommend to Joseph which account he should choose.
tim urban ownermanager of urbans motor court in key west is considering outsourcing the daily room cleanup for his
Stock Y has a beta of 1.25 and an expected return of 12.6 percent. Stock Z has a beta of .8 and an expected return of 9.9 percent. Required: What would the risk-free rate have to be for the two stocks to be correctly priced relative to each other?
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Q1. Money market interest on the Danish Krone on 23 April were:
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