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What is the interest cost on the cash required

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Reference no: EM133006097

Question - Rebecca Co. has the following selected information from its most recent annual financial statements:

 

20X8 $

20X7 $

Accounts receivable

223,400

226,700

Inventories

121,700

151,600

Accounts payable

177,400

153,900

Sales (all on credit)

779,800

798,300

Cost of goods sold

350,910

359,235

Operating expenses*

77,400

78,900

*Operating expenses include depreciation and amortization of $10,500 in 20X8 and $10,100 in 20X7. The company pays 8% annual interest on borrowings from its bank.

Required - What is the interest cost on the cash required to finance the company's estimated cash conversion cycle in 20X8?

a) $17,433

b) $18,117

c) $22,221

d) $12,819

Reference no: EM133006097

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