WebCost of marginal investment in accounts receivable: Marginal investment in Accounts Receivable $23,830,193 Required return 0.14 Cost of marginal investment in A/R $3,336,227 d. The $6,000,000 additional profitability exceeds the additional costs of $3,336,227. WebJul 26, 2024 · It is typical for a business to perceive their Accounts Receivable as a cash equivalent. Sadly this short term asset has a lot of differences that are commonly overlooked, such as, the cost of capital, doubtful accounts, and payment/collections expense. The following infographic draws attention to these overlooked costs of …
How is cash flow affected by the average collection period? - Investopedia
WebSelect one: a. accounts payable b. marginal investment in accounts receivable c. cost of marginal investment in accounts receivable d. profit contribution from sales e. This problem has been solved! You'll get a detailed solution from a subject matter expert that helps you learn core concepts. See Answer WebThe board is currently investigating a change in the collection of accounts receivable that is expected to result in a 20% increase in credit sales and a 10% increase in the average collection period. Bad debts will also increase, from 2% to 4% of sales. The firm’s opportunity cost on its investment in accounts receivable is 12%. how to repair bubbled paint on drywall
INVESTMENT IN ACCOUNTS RECEIVABLE - Google Sites
Web1 day ago · We raise some critical points against a naïve interpretation of “green finance” products and strategies. These critical insights are the background against which we take a cl WebMar 4, 2024 · Calculate the cost of the marginal investment in accounts receivable. Tara’s Textiles currently has credit sales of $360 million per year and an average collection period of 60 days. Assume that the price of Tara’s products is $60 per unit and that the variable … WebThe firm's cost of marginal investment in accounts receivable is. A) $5,556. B) $9,943. C) $12,153. D) $152,778. 45) A firm is considering relaxing credit standards which will result in an increase in annual sales from $3 million to $3.75 million, a decrease in the cost of … north american life ins