The Turn It Up Corporation sells on cred

91. The Turn It Up Corporation sells on credit terms of net 30. Its accounts are, on average, 6 days past due. Annual credit sales are $7 million. What is the company's balance sheet amount in accounts receivable? 
A. $690,411
B. $723,333
C. $851,667
D. $915,407
E. $923,593


92. Keep M Flying is a wholesaler that stocks engine components and test equipment for the commercial aircraft industry. A new customer has placed an order for eight high-bypass turbine engines, which increase fuel economy. The variable cost is $1.7 million per unit, and the credit price is $2.1 million each. Credit is extended for one period. Based on historical experience, payment for about 1 out of every 240 such orders is never collected. The required return is 2.8 percent per period. What is the NPV per unit if this is a one-time order? 
A. $316,407
B. $328,819
C. $334,290
D. $342,802
E. $351,056


93. Quest, Inc., is considering a change in its cash-only sales policy. The new terms of sale would be one month. The required return is 1.6 percent per month. Based on the following information, what is the NPV of the new policy?

A. $28,750
B. $32,500
C. $35,000
D. $38,250
E. $40,000


94. Cohen Industrial Products uses 2,100 switch assemblies per week and then reorders another 2,100. The relevant carrying cost per switch assembly is $20, and the fixed order cost is $300. What is the EOQ? 
A. 1,279.84
B. 1,434.14
C. 1,809.97
D. 2,278.42
E. 2,698.15


95. Roger's Store begins each week with 150 phasers in stock. This stock is depleted each week and reordered. The carrying cost per phaser is $48 per year and the fixed order cost is $70. What is the optimal number of orders that should be placed each year? 
A. 48.69
B. 51.71
C. 54.20
D. 61.10
E. 64.50


96. The Dilana Corporation is considering a change in its cash-only policy. The new terms would be net one period. The required return is 2 percent per period. What is the NPV of the new policy given the following information?

A. -$230,880
B. -$118,420
C. $311,508
D. $428,997
E. $566,840


97. The Cycle Shoppe has decided to offer credit to its customers during the spring selling season. Sales are expected to be 330 bicycles. The average cost to the shop of a bicycle is $300. The owner knows that only 93 percent of the customers will be able to make their payments. To identify the remaining 7 percent, she is considering subscribing to a credit agency. The initial charge for this service is $540, with an additional charge of $6 per individual report. What is the amount of the net savings from subscribing to the credit agency? 
A. $3,790
B. $3,920
C. $4,080
D. $4,410
E. $4,950


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09 Feb 2018
Due Date: 09 Feb 2018

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