Multiple Choice
You plan to place an order with a new supplier. You have been offered terms of 2/10, net 50 from the date your supplies are shipped. The cost of borrowing from the bank is 15 percent on an annual basis. What is the best course of action in paying the supplier, assuming the firm will need to borrow if it takes the discount?
A) Pay as soon as supplies are received.
B) Pay on the 10th day.
C) Pay on the 50th day.
D) Pay on the 51st day.
Correct Answer:
Verified
Correct Answer:
Verified
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