Delta PDA Distributors has an investment in accounts receivable of $2,750,000. Daily credit sales are $118,280. If 30% of Delta's credit customers receive a discount by paying within 10 days and the remainder of Delta's customers pay in 40 days, what is the net period that Delta maintains?

Question

Quizplus · Accepted Answer

The net period is calculated as a weighted average of the payment periods: (0.3 * 10 days) + (0.7 * 40 days) = 3 days + 28 days = 31 days.

Delta PDA Distributors Has an Investment in Accounts Receivable of $2,750,000