Practice asessment 2 task 6 Credit management, does anyone know how to calculate this please?

storres
storres Registered Posts: 9 New contributor 🐸
in Credit and Debt Management

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  • Bonnie28
    Bonnie28 Registered Posts: 27 Regular contributor ⭐
    Effective rate interest

    Formula= d/100-d X 365/N-D

    d= discount percentage given
    N=normal payment term
    D=Discount payment term

    Therefore we do not have any days given so we will only use the percentage side

    2%/98% *100 =2.04%


    discounts periods

    Using the same method

    Here we do not have the percentage side so it is going to be a straight

    365/16 =22.81


    Finally

    2.04% X 22.81 =46.53

    =47%

    OR

    2%/100%-2% X 365/30-14

    2/98 X 365/16

    0.02040816326 X 22.8125

    0.4655 *100%

    =47%


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