Gamesoft Inc

question 2

Multiple Choice

Gamesoft Inc. has $100 million in annual credit sales that take an average of 40 days to collect. to meet Gamesoft's cash flow problems it maintains a floating loan at 10% interest. Gamesoft says they are indifferent to factoring their receivables at a 3% fee. The factor would advance 70% of the receivables at 8% interest, would cut the collection period down to only 30 days, and eliminate all bad debts. What is the amount of Gamesoft's bad debts that exist by collecting the receivables on its own?

• A) $246,575
• B) $460,274
• C) $1,095,890
• D) $2,610,959
• E) $3,000,000

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Definitions:

Protégé

A person who is guided and supported by an older and more experienced or influential person.

Newcomers' Proactive Behaviours

Activities initiated by new members of an organization aimed at understanding, assimilating, and contributing to the workplace.

Locus of Control

A psychological concept that describes the degree to which individuals believe that they have control over the outcome of events in their lives.

Psychosocial Function

Aspects of psychological and social activities or behaviors that influence an individual's well-being and social integration.