Problematlanta cement inc buys on terms of 215 net 30 it, Ask an Expert

Accounting

Problem:

Atlanta Cement, Inc. buys on terms of 2/15, net 30. It does not take discounts, and it typically pays 115 days after the invoice date. Net purchases amount to $720,000 per year.

Requirement:

Question: What is the nominal annual percentage cost of its non-free trade credit, based on a 365-day year?

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91168047

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