ACC 131 Seipp Week 8 Lecture Notes: 10/5-10/9
ACC 131 Seipp Week 8 Lecture Notes: 10/5-10/9 ACC 131
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This 1 page Class Notes was uploaded by Daniel Hemenway on Thursday October 15, 2015. The Class Notes belongs to ACC 131 at Illinois State University taught by Edward Seipp in Summer 2015. Since its upload, it has received 33 views. For similar materials see Financial Accounting in Accounting at Illinois State University.
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Date Created: 10/15/15
ACC 131 Seipp 105 109 Cash Management Factoring Receivables Factoring Receivables Selling receivables to other companies at a discounted rate When receivables are factored the seller receives an immediate cash payment reduced by the factor s fees The factor the buyer of the receivables acquires the right to collect the receivables and the risk of uncollectibility Notes Receivable Notes Receivable Receivables hat generally specify an interest rate and a maturity date at which any interest and principal must be repaid Promissory Note Principal The amount lent Interest The excess of the total amount of money collected over the amount lent Maturity Principal and interest rates are due Calculating Interest Rates are always annual unless stated otherwise Interest Principal x Annual Int Rate x Fraction of One Year which is T12 Analyzing Receivables Accounts Receivable Turnover Accts Rec Turnover Net Sales Avg Net Accts Receivable Avg Net Accts Receivable Beginning Accts Rec End Accts Rec 2 If the Accts Rec Turnover 64 take 36564 in order to see how often your accts Receivable are being paid 36564 570350 every 5703 days your accts Receivable are being paid
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