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Hi sir,
I’ve noticed that in some cases we find cost of providing early settlement discount with the formula and in the other as a percentage of total revenue. I’m not able to make out when to use which.Can u please help me out..It really depends on what the question is asking for.
Questions either ask you to calculate the effective cost as a %, or alternatively to calculate the annual net cost or benefit in $’s.All I can really suggest is for you to watch my free lectures where I work through examples of both approaches, and that you practice questions from your Revision Kit and ask in this forum if ever you are not clear which approach to use in any particular question.
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