A merchant sells a product on credit for S/ 50,000 and offers to pay it to a client in three bills of equal nominal value and with maturities at 45, 75 and 105 days respectively, applying on them an APR of 30% with bimonthly capitalization. If this merchant plans to discount the bills in a bank 15 days after the sale is made, being the effective discount rate 2% per month, find:

Q: A retailer owes a wholesaler $700,000 due in 45 days. If the payment is 15 days late, there is a 1%…

A: Part (a): Calculation of interest amount: Answer: 45 day certificate interest is $7,000 65 day…

Q: A store will give you a 4.00% discount on the cost of your purchase if you pay cash today.…

A: Given information : Discount rate = 4% Time period for payment due = 1 month  Purchase price…

Q: Your company has been offered credit terms on its purchases of 4/30, net 90 days. What will be the…

A: Trade credit is the arrangement by which the customer gets additional time to repay the dues and…

Q: A store will give you a 4.50% discount on the cost of your purchase if you pay cash today.…

A: The implicit rate of borrowing is the cost paid in the terms of discount by the customer if the…

Q: Percentages need to be entered in decimal format, for instance 3% would be entered as .03.)…

A: Calculation with proper explanation given in next sheet.

Q: Assume that you start with a balance of $3900 on your credit card.During the first month you charge…

A: Here, Balance on Credit Card is $3900 APR is 29% Charges for first Month is $400 Charges for Second…

Q: Kumi Ltd permits its customers to pay with a credit card or to receive a percentage discount x for…

A:

Q: A merchant buys a bill of goods requiring the payment of $1,500 at the end of 180 days. He is…

A: Cash management involves decision regarding whether, to make early payments to the suppliers and…

Q: Your company has been offered credit terms on its purchases of 4/30, net 90 days. What will be the…

A: The an agreement to purchase products and/or services on credit rather than making immediate cash or…

Q: A car dealer carries out the following calculations. What is the annual percentage rate?   Lis…

A: As per the given information: Amount to be financed - $4,691.03 Interest rate - 10% Months of…

Q: The balance on a credit card, that charges a 10.5% APR interest rate, over a 1 month period is given…

A: Interest rate = 10.5% Initial balance = $150  Number of days = 1-3 is 3 days Number of days = 4-20…

Q: A company is offering a 4.9% discount to receivables if they agree to pay within 45 days. The…

A: A credit discount is a discount offered to the borrower of money by the lender of money if the…

Q: A car dealer advertises the sale of a car model for a cash price of P280,000.00. If purchased on…

A: Present value of an annuity: It is the value of all future payments at the present date at some…

Q: A washer-dryer combination can be purchased from a department store by making monthly credit card…

A: Given: Particulars Amount Monthly payment $46.34 Years 3.5 Interest rate 21% Additional…

Q: tore offers its salespeople a table with coefficients to be applied to the cash sale value of its…

A: Coefficients are very important in calculating the monthly payments and value of these depends on…

Q: Assume that you start with a balance of $4000 on your Visa credit card. During the first month, you…

A: Finance charges are levied by credit card companies if credit card holder fails to make payment on…

Q: A company has a choice of borrowing money by issuing commercial paper or opening a line of credit.…

A: a)Commercial Paper is a Short Term Debt Security issued by a large and reputed Company in Money…

Q: A car dealer advertises the sale of a car model for a cash price of P 280,000. If  purchased on…

A: Formula to Calculate Monthly Payments Monthly Payments = (P X R/12) X [(1 +R/12)^N)/ [(1+R/12)^N -1]…

Q: A firm sells its accounts receivables to a factor at a 3.5% discount. The average collection period…

A: Average collection period = 3 months Discount = 3.5% Receivables Turnover = 12months / Average…

Q: A company buys on terms of 2/15, net 30 days. It does not take discounts, and it typically pays 35…

A: Nominal Annual Cost = Discount percent(100-Discount percent) × 365 daysTotal Pay period - Discount…

Q: A credit is paid as follows: a down payment corresponding to 30% of the value of the credit, 16…

A: Fist we need to calculate present value of all payments starting at 3 months after by using annuity…

Q: A supplier is offering your firm a cash discount of 2 percent if purchases are paid for within ten…

A: We will have to compute the effective rate of cash discount being offered by the supplier.

Q: Illustration: A company sells $50,000 of goods with the terms net/30. The receivable is immediately…

A: Sales price = $50,000 Factor fee = 3% Interest = 10% reserve = 8%

Q: ur customers has just made a purchase in the amount of $28,000. You have agreed to payments of $590…

A: The time period to pay the loan will depends on the interest rate and compounding of loan and…

Q: Percentages need to be entered in decimal format, for instance 3% would be entered as .03. Cooley…

A: Factoring of  accounts receivable: In general business, accounts receivable are sold out to another…

Q: Assume that you start with a balance of $3600 on your credit card. During the first month, you…

A: Given Starting balance is $3600 First month charge is $400 Second month charge is $550

Q: Big Dom’s Pawn Shop charges an interest rate of 20 percent per month on loans to its customers. Like…

A: APR = given monthly rate * 12 months

Q: One of your customers has just made a purchase in the amount of $26,400. You have agreed to payments…

A: A loan is a debt amount borrowed by one person from another person at a predetermined financial…

Q: Breeze Corp. is planning to change its credit terms from 4/10, n/30 to 5/15, n/35. Currently, 50% of…

A: Days sales outstanding refer to average number of days that an organisation or a company takes to…

Q: fers two credit terms to YVONE as follows: Credit term number 1: 2/15, net 30 C

A: A term that helps in indicating when the amount of payment is due for the sales and made on credit…

Q: A store will give you a 1.75% discount on the cost of your purchase if you pay cash today.…

A: The concept of the time value of money states that the same amount of money is worth more today than…

Q: A credit card offers an introductory rate of 7% compounded monthly for the first six months,…

A: A credit card is a short-term credit facility provided by the banks to its customers. Interest is…

Q: A credit card account’s due date is June 9, and the outstanding balance on that day is $460. On that…

A: The question is based on the concept for calculation of charges in credit card . Average daily…

Q: A retailer owes a wholesaler $900,000 due in 45 days. If the payment is 15 days late, there is a 1%…

A: Concept. Certificate of deposit is money market instrument which is issued in dematerialized form…

Q: Rex Corporation accepted a $3,500, 5%, 120-day note dated August 8 from Regis Company in settlement…

A: Notes Receivables - Notes Receivables are the promise to pay money on the specified date with the…

Q: Big Dom's Pawn Shop charges an interest rate of 25.5 percent per month on loans to its customers.…

A: APR refers to the annual percentage return it is calculated by multiplying the periodic rate to the…

Q: Queen Corp sells on terms of 2/10, n/30. 70% of customers normally avail of the discounts. Annual…

A: The calculation of average accounts receivable has been made as follows:

Q: A bank is offering to sell 6-month certificates of deposit for $12,000. At the end of 6 months, the…

A: Given information: Present value of deposit amount $12,000 After 6 months, it will pay $13,000

Q: A merchant buys a bill of goods requiring the payment of 1500php at the end of 180 days. He is…

A: Rate of discount=5%Purchase price=1500

Q: Black Panther Inc. buys on terms of 2/15, net 60 days. It does not take discounts, and it typically…

A: Credit terms indicate the percentage discount a firm can take off the invoice amount if payments…

Q: A​ washer-dryer combination can be purchased from a department store by making monthly credit card…

A: For calculation of purchase price we need to use the following formula of annuity due PV of annuity…

Q: Which one of the following statements is correct if you purchase an item with credit terms of 3/15,…

A: The credit terms are the terms of sale for customers who have been extended credit by the firm. Here…

Q: JAB Consulting received a promissory note of $13,500 at 7% simple interest for 15 months from one of…

A: Frist we need to calculate the maturity value of promissory note by using this equation. Maturity…

Q: A note with a face value of BD 2,600 will mature after 3 Years from today is sold to a bank that…

A: Given information is: Face value of Note = BD 2600 Period = 3 years Compound interest rate = 6% Bank…

Q: On May 12, Scott Rinse accepted an $15,500, 14%, 90-day note for a time extension of a bill for…

A: The question is based on the concept of Financial Management.

Q: A car dealer will sell you a used car for $6,998 with $798 down and payments of $164.51 per month…

A: Using the rate function in excel