Presented By:

Raja Nadeem Asghar Kayani

Presented To:
Sara Siddique

Class:
BBA-2-A
 Case Study

8-2, Even:

Sol:

Exe 1:
Sol:

Price= $1.964 7/5/2.5

100% - 7%= 93%

= 93/100 = 0.93

100% - 5%= 95%

= 95/100=0.95

100% - 2.5%= 97.5%

= 97.5/100=0.975

(0.95) (0.95) (0.975) * 1.964= 1.691

Exe 2:
Sol:

Price= $2.086 10/7/4

(0.90) (0.93) (0.96) * 2.086= 1.676

Supplier 2 would be a better deal for his company.

Exe 3 :
Sol:

Sales = $25000 2/15 net/30 with a 1% service charge on late payments.

Half on time $12500

Discount Period 12500 (0.98)= Savings $250

Penalty Paid 12500 (0.95)=$ 625(0.01) =$6.25 in penalty fees.

Exe 4 :
Sol:

The current situation shows that 55% of the sales volume is being paid after the
30 days which the penalty service applies. He only loses which is paid in discount that is
only 0.25* 0.2 =0.005S and assuming he is eventually paid he receive 0.995S a month.

Suggestions: Rob could encourage his customers to make prompt payment by offering
a higher discount for payment within 15 days and by increasing the penalty for late
payment. He improves his purchasing ability to keep his stock at an Although, based on
current stats, he would lose more in discount and gain more in penalties. He may be able
in this way to reduce the percentage of late-paying customers n acceptable level.