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Use the information in the table below to answer the questions concerning Company Cs current...

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Question

Accounting

Use the information in the table below to answer the questions concerning Company Cs current credit policy.

net 40

Sales

$9,000,000

Lag factor

3

Cost of capital

8%

Bad debt, % sales

5%

Cost of goods sold, % sales

79%

G&A, % sales

9%

1. What is the present value of the firms daily net sales?

2. What is the firms daily cost of good sold?

3. What is the firms DSO (Net + lag factor)?

4. What is the present value of the firms daily G&A expense?

5. What is the net present value of the firms current policy?

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