Factoring: Pride, Inc

question 32

Multiple Choice

Factoring: Pride, Inc., sells $150,000 of its accounts receivable to factors at 2.875 percent discount. The firm's average collection period is 75 days. What is the simple annual interest cost of the factors loan?

• A) 35.5%
• B) 32.9%
• C) 27.8%
• D) 31.1%

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