What minimum average collection period is required

Assignment Help Finance Basics
Reference no: EM131109286

Klein's Tools is considering offering a cash discount to speed up the collection of accounts receivable. Currently the firm has an average collection period of 65 days, annual sales are 35,000 units, the per-unit price is $40, and the per-unit variable cost is $29. A 2% cash discount is being considered. Klein's Tools estimates that 80% of its customers will take the 2% discount. If sales are expected to rise to 37,000 units per year and the firm has a 15% required rate of return, what minimum average collection period is required to approve the cash discount plan?

Reference no: EM131109286

Demonstrate an understanding of statistical analysis

Discuss the problems of getting survey data in the real world, also discuss ethics you need to consider when gathering survey data. Also give an example of a real world prod

Comparable transaction analysis

Company A shares are currently trading at $50 per share. A survey of Wall Street analysts disclose that EPS expectations for firm A for the full year 2003 are $2.50 per share.

What tendencies about flotation costs

As a recent business school graduate, you work directly for the corporate treasurer. Your corporation is going to issue a new security and is concerned with the probable

Briefly describe the tax incentive

Like the federal government, state and local governments offer tax incentives to businesses to help solve economic and/or environmental issues. Read the following articles

Determine the expected return of equity

Hardmon Enterprises is currently an all-equity company with an expected return of 12 percent. It is planning a leveraged recapitalization in which it would borrow and repurcha

Problem regarding the cost of debt

Sincere Stationery Corporation needs to raise $451,000 to improve its manufacturing plant. It has decided to issue a $1,000 par value bond with an annual coupon rate of 10.1

Different tasks and roles you learned about

Reflect on the different tasks and roles you learned about in this course. Identify at least (two) 2 skills you would need to be a project manager and discuss what you can d

What steps can this company take to diversify its portfolio

What steps can this company take to diversify its portfolio? Define diversification and its necessity in risk management.Discuss at least 5 steps to diversify the card busines

Reviews

Write a Review

 
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd