Buskirk construction buys on terms of 215 net 60 days it, Finance Basics

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Buskirk construction buys on terms of 215 net 60 days it

Question: Buskirk Construction buys on terms of 2/15, net 60 days. It does not take discounts, and it typically pays on time, 60 days after the invoice date. Net purchases amount to $500,000 per year. On average, how much "free" trade credit does the firm receive during the year? (Assume a 365-day year, and note that purchases are net of discounts.)

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Finance Basics: Buskirk construction buys on terms of 215 net 60 days it

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