The Green Hornet offers a trade discount with terms of 2/5, EOM. Assume you purchase an item on credit from The Green Hornet

A 2/10, net 30 credit policy:    A.  is an expensive form of short-term credit if a buyer foregoes the discount. B.  provides cheap financing to the buyer for 30 days. C.  is an inexpensive means of reducing the seller's collection period if every customer takes the discount. D.  tends to have little effect on the seller's collection period. E.  tends to increase a firm's investment in receivables as compared to a straight net 30 policy. Refer to section 20.2

32.	The Green Hornet offers a trade discount with terms of 2/5, EOM. Assume you purchase an item on credit from The Green Hornet on Monday, November 3. What is the invoice date for this purchase?    A.  November 3 B.  November 5 C.  November 7 D.  November 8 E.  November 30 Refer to section 20.2

33.	Which one of the following credit instruments is commonly used in international commerce?    A.  open account B.  sight draft C.  time draft D.  banker's acceptance E.  promissory note Refer to section 20.2

34.

A conditional sales contract:    A.  passes title to the goods sold to the buyer at the time the contract is signed. B.  normally calls for one lump sum payment on the contract payment date. C.  generally has a built-in interest cost. D.  is payable immediately upon receipt. E.  is a formal bid for a project. Refer to section 20.2

35.

Which of the following statements correctly reflect the effects of granting credit to customers? I. Total revenues may increase if both the quantity sold and the price per unit increase when credit is granted. II. A firm's cash cycle generally increases if credit is granted, all else equal. III. Both the cost of default and the cost of discounts must be considered before granting credit. IV. A firm may have to increase its long-term borrowing if it decides to grant credit to its customers.    A.  I, II, and III only B.  II, III, and IV only C.  I, III, and IV only D.  I, II, and IV only E.  I, II, III, and IV Refer to section 20.3