Your Firm Purchases Goods from Its Supplier on Terms of 2/10,net

Multiple Choice

Your firm purchases goods from its supplier on terms of 2/10,net 40.The effective annual cost to your firm if it chooses not to take advantage of the trade discount offered and stretches the accounts payable to 60 days is closest to:

A) 20.1%
B) 15.9%
C) 13.0%
D) 11.1%
E) 9.5%