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”what impact a reduction in the percentage discount offered and a
general increase in interest rates would have on the financial acceptability of an early settlement
discount,”
this is a past exam topic with no ans so can you please tell me if ive got this rightincrease in discount rate would reduce acceptability as greater costs/
and also increase in interest rates would increase acceptability if the savings in A/R as a result of discounts means that we could enjoy higher finance cost savings?Yes, you do have it right.
(I am surprised that you have managed to have the question but not to have the exam answer 🙂 )
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