Owen Was Surprised When He Calculated the Percentage Annual Interest

Multiple Choice

Owen was surprised when he calculated the percentage annual interest rate on his accounts payable. He discovered that failure to take advantage of the discount offered by suppliers

A) makes a small difference because a business does not pay a high interest rate.
B) makes a large difference because a business pays a high interest rate.
C) has no effect on cash flows.
D) will have erratic effects on rates for the use of a supplier's money.