Quote:
Originally Posted by red-beard
You are simply looking at the "cost of capital". We had some similar issues, but you may want to factor in what you could have done with that capital. Is the extension preventing other business?
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I was mostly wanting to compare the costs between the different discount rates and was hoping to find an on-line calculator that would make it easy.
In my case, "what I could have done with that capital" doesn't really apply here because I'm going to add that discount cost to the purchase price. My company produces food (roasted almonds, etc) and when I price my products, everything that goes into that product (including overhead) goes into the price, then add profit.
I hate it though, when big companies demand a discount. I wish they would all just get in line and go with the flow - Net 30, that's how I'm paying my suppliers.