Question 2c, d
Marking Guide
| (a) | revised trade receivables | 0.5 | |
| reduction in trade receivables | 0.5 | ||
| reduction in finance cost | 1 | ||
| administration costs | 0.5 | ||
| saving in bad debts | 0.5 | ||
| interest on advance | 1 | ||
| with-recourse factor fee | 0.5 | ||
| net benefit of with-recourse offer | 0.5 | ||
| without-recourse factor fee | 0.5 | ||
| elimination of bad debts | 1 | ||
| net benefit of non-recourse offer | 0.5 | ||
| max marks | 7 | ||
| (b) | comment on financial acceptability of offer | 1-2 | |
| benefits of factoring (1-2 marks per benefit) | 5-6 | ||
| max marks | 7 |