Multiple Choice
Ignoring defaults, what is the approximate effective cost of factoring if receivables are sold at a 4% discount and the average collection period is 2 months?
A) 19.40%
B) 24.00%
C) 26.53%
D) 27.75% $4/$96 = 4.17% per two-month period
Correct Answer:
Verified
Correct Answer:
Verified
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