Compute the annual rate of return for the cash Discounts
Cash discounts ROI
Calculate the appropriate annual rate of return on investment of the following cash discount terms
1. What is the annual rate of return on investment? Use 360 day year in your calculation (use decimal points)
2. What is the annual rate of return on investment? Use 360 day period
3. Which of the terms 1-3 part a is not likely to be significant incentive to customers to pay promptly
(a)1/15, net 30
(b)2/10, net 60
(c)1/10 net 90