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  • Financial Management

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    co.harshii.agrawal
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    1. The document discusses various debtors and costs associated with providing credit to them, including blockage costs, cost of capital, discount rates, and annual percentage costs. 2. It addresses calculating the annual percentage cost for a debtor by taking into account factors like the number of days of credit extended and the cost of capital. 3. Finally, it distinguishes between fixed and variable costs, noting that variable costs generally only include the cost of credit sales, while fixed costs include additional fixed operating expenses.

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    notes of financial management

    Original Title

    financial management

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    1. The document discusses various debtors and costs associated with providing credit to them, including blockage costs, cost of capital, discount rates, and annual percentage costs. 2. It addresses calculating the annual percentage cost for a debtor by taking into account factors like the number of days of credit extended and the cost of capital. 3. Finally, it distinguishes between fixed and variable costs, noting that variable costs generally only include the cost of credit sales, while fixed costs include additional fixed operating expenses.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    11 views13 pages

    Financial Management

    Uploaded by

    co.harshii.agrawal
    1. The document discusses various debtors and costs associated with providing credit to them, including blockage costs, cost of capital, discount rates, and annual percentage costs. 2. It addresses calculating the annual percentage cost for a debtor by taking into account factors like the number of days of credit extended and the cost of capital. 3. Finally, it distinguishes between fixed and variable costs, noting that variable costs generally only include the cost of credit sales, while fixed costs include additional fixed operating expenses.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 13

    &

    Debtors C.S. X

    /52
    =

    cost
    ② Aug. Blockage
    is
    -

    X
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    -
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    (2) 8 times/8.1 times

    (3) 6 times/
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    Variable
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    cost

    Generally. ↓ Generally
    -
    #

    E E
    y of Amount
    Sales Term
    Cost
    Ye
    op4 X ROR
    - of X
    Cost
    Credit
    Sales

    -
    Avani c al Variable
    I
    cost
    in
    Except
    ~
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    when is
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    question,then
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    be as

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    ② When wep rateof Return GROR]


    is ADDITIONAL INVESTMENT
    given on

    then variablecost will


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    be considered as cost of CS.
    ③ NEW ACCOUNTS

    -
    en
    Total Sales= 62,50,000

    Credit sales' 50,00,000

    [tot. of62,50,000

    Nx85%.
    v. cost of Credit 42,50,00
    sales
    I
    t
    Fixed cost

    (b12500x80%7
    ↳so i

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