Factoring Finance Example: Invoices Paid in 30 Days

Factoring Finance Example: Accounts Receivables Financing for 30 Days

Let us assume that the your company has a corporate customer that normally pays 30 days after they have been invoiced and you invoice them for $10,000.00. By factoring their accounts receivable, your company can receive an advance in a matter of hours. Here is how the math works:

Your company’s invoice $10,000.00
80% Advance $ 8,000.00
Less: Initial Financing Fee $    350.00

Your company receives an advance of $ 7,650.00
Invoice balance held in reserve* $ 2,000.00

Factoring Fee for an invoice outstanding for 30 days is $350.00

* The reserve is refunded to the client when the invoice is paid.

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