2B5BB DUDLEY PRODUCTS IS GIVEN TERMS OF 2/10, NET 45 BY ITS SUPPLIERS...
177.
CSO: 2B5f
LOS: 2B5bb
Dudley Products is given terms of 2/10, net 45 by its suppliers. If Dudley forgoes the
cash discount and instead pays the suppliers 5 days after the net due date, what is the
annual interest rate cost (using a 360-day year)?
a.
18.0%.
b.
18.4%.
c.
21.0%.
d.
24.5%.