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WXWP WXWP
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6 years ago
An entrepreneur who is considering purchasing a business is analyzing a company's accounts receivable.  The following table summarizes her findings.

   Age of Accounts   Amount   Probability of Collection
   0 - 30 days   $12,000   .96
   31 - 60 days   $  4,000   .87
   61 - 90 days   $  2,500   .71
   91 - 120 days   $  1,400   .65
   121 + days   $     800   .24

How much should this potential buyer be willing to pay for these accounts receivable?
A) Nothing ; a buyer should never purchase existing accounts receivable.
B) $20,700
C) $17,877
D) Not enough information given to determine
Textbook 
Essentials of Entrepreneurship and Small Business Management

Essentials of Entrepreneurship and Small Business Management


Edition: 6th
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CalbertoCalberto
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6 years ago
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WXWP Author
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6 years ago
Good timing, thanks!
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dedricgard
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2 hours ago
Thank you, thank you, thank you!
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