The cost of forgoing the discount

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Simple? Simon's Bakery purchases supplies on terms of 1.0/10, net 25. If Simple? Simon's chooses to take the discount? offered, it must obtain a bank loan to meet its? short-term financing needs. A local bank has quoted Simple? Simon's owner an interest rate of 12.0% on borrowed funds. Should Simple? Simon's enter the loan agreement with the bank and begin taking the? discount? (Hint: Use 365 days for a? year.)

The cost of forgoing the discount is ____?%.

Reference no: EM131497664

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