Lacey's Has an Average Collection Period of 32 Days and Factors

question 104

Multiple Choice

Lacey's has an average collection period of 32 days and factors all of its receivables immediately at a 1.1 percent discount.Assume all accounts are collected in full.What is the firm's effective cost of borrowing?

• A)13.38 percent
• B)13.45 percent
• C)13.57 percent
• D)13.63 percent
• E)13.88 percent

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