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What Is the Effective Annual Cost of Credit Terms of 2/20,net

Question 20

Multiple Choice

What is the effective annual cost of credit terms of 2/20,net 60,if the firm stretches the accounts payable to 80 days?

A) 6.4 %
B) 13.1%
C) 21.1%
D) 34.2%
E) 41.4%

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