Policy on Accounts Receivable Csulb Form

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this is a lecture from open tuition to benefit from the lecture you should download the free lecture notes from open tuition com alright we're still talking about the management of receivables and in the previous lecture we went through what I call a simple settlement discount which I hope made sense has been straightforward however where he gets a little bit more interesting a little bit more work needed is what I call a change of policy where we need a slightly different approach and let me explain what I mean with the example look at example two a company has sales of 20 million per year customers currently take credit to swallows some pay after 30 days it says 20 percent pay after 30 days 50 percent / after 60 days 30 percent they take 90 days now the company is considering offering a discount of 1 percent for payment within 30 days and is estimated that 60 percent of customers will take advantage of the discount so future 60 percent of in the pain 30 days the remainder will take a