Ignoring Defaults, What Is the Approximate Effective Cost of Factoring

question 83

Multiple Choice

Ignoring defaults, what is the approximate effective cost of factoring if receivables are sold at a 2% discount and the average collection period is 1 month?

• A) 19.40%
• B) 24.00%
• C) 26.53%
• D)27.43%

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Definitions:

Medulla

A section of the brainstem involved in autonomic functions such as breathing, heart rate, and blood pressure regulation.

Breathing

Breathing is the physiological process of inhaling oxygen and exhaling carbon dioxide, essential for life.

Heart Rate

The number of heartbeats per minute, a significant indicator of cardiovascular health and physical fitness.

CT Scanning

A medical imaging technique that combines a series of X-ray measurements taken from different angles to produce cross-sectional images of specific areas of a scanned object, allowing the user to see inside the object without cutting.