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Management of receivables

How is the required rate of return an opportunity cost?

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Swathi Krishna

Swathi Krishna

CA Inter

7K+

23-Oct-20 12:51

31

Answers (2)

If you had deployed money elsewhere you will get minimum that much return - it is called internal hurdle rate. All investments ( in this case credit extended to debtors) must yield a minimum of that rate and hence opportunity cost is the required rate of return


Sriram Somayajula

Sriram Somayajula

Admin

25-Oct-20 11:25

K thax sir


Swathi Krishna

Swathi Krishna

CA Inter

7K+

25-Oct-20 14:08

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