The annual interest rate is %
Q: A payday loan is structured to obscure the true interest rate you are paying. For example, in…
A: Effective rate of interest is the equivalent interest rate which is determined by considering the…
Q: Kumi Ltd permits its customers to pay with a credit card or to receive a percentage discount ? for…
A: Given:
Q: A person borrows $3,000 on a bank credit card at a nominal rate of 18% per year, which is actually…
A: Loan is the value which is borrowed from the other sources like banks and this amount repaid later…
Q: A customer takes out a loan of $150,000 on January 1, with a maturity date of 36 months, and an…
A: Interest on loan:-It is the rate levy on the initial amount of loan and this is the additional…
Q: A bank charges 1 ½% per month on the unpaid balance for purchases made with its credit card. This is…
A: The equivalent effective annual rate can be calculated through the compounding interest formula. The…
Q: pays a 9.75% nominal rate on deposits, with monthly compounding. What effective annual rate (EFF%)…
A: The effective annual rate can be computed as follows :- EAR = (1+i / x)^x - 1 = (1 + 0.0975/12)^12…
Q: First National Bank offers two-year CDs at 9.16% compounded daily, and Citywide Savings offers…
A: First National Bank r=9.16% compounded daily n= 365 Annual yield formula is…
Q: A payday loan is structured to obscure the true interest rate you are paying. For example, in…
A: In this case, first, we have to calculate the biweekly interest rate and then we have to calculate…
Q: You want to lend $12,000 as a bank deposit in a private bank with an interest rate 3 % per month.…
A: The worth of money changes with time. Therefore, the time value of money explains the worth of money…
Q: Martinez Sporting Goods borrows $4,500, at 5% interest, for 120 days. Use the exact interest method…
A: Interest amount is the fixed amount that the lender will charge for lending some amount for certain…
Q: A person borrows $3,000 on a bank credit card at a nominal rate of 18% per year, which is actually…
A: Annual Percentage Rate It the total interest paid each year which is before consideration for the…
Q: On March 1, Minnerly Motors obtains a business loan from a local bank. Theloan is a $25,000…
A: The formula to compute interest charge as follows:
Q: Credit card issuers must by law print the annual interest rate they charged borrowers. If the annual…
A: Annual interest rate = 15% Compounding = Monthly Number of compounding per year = 12
Q: a bank charges one and one-half percent per month on the unpaid balance for purchases made its…
A: Present value is the sum of the current value of money of future cash flows. It is also known as a…
Q: American Express and other credit card issuers must by law print the Annual Percentage Rate (APR) on…
A: Information given : Annual Percentage Rate (APR) = 15.75% = 0.1575 Compounding frequency = Monthly…
Q: Mr samuel approached the arnett national bank for a 15,000 loan to purchase vehicle the bank charges…
A:
Q: A payday loan is structured to obscure the true interest rate you are paying. For example, in…
A: (1). We, have to find the two week interest rate and that there are 26 two week periods in one year.…
Q: how much money is requested from the bank if the simple interest rate is 9.766% a. 36,857.114 b.…
A: Simple interest refers to the amount paid by the borrower to bank on the amount borrowed at a fixed…
Q: Summit Record Company is negotiating with two banks for a $127,000 loan. Fidelity Bank requires a…
A: Here, Details of Fidelity Bank: Loan Amount is $127,000 Compensating Balance is 22% Number of…
Q: Inc. offered a one-year loan to a customer client. The instrument is a discounted note with a…
A: Discount rate of note (R) = 15%
Q: The bank statement opposite shows transactions over a one-month period for a savings account that…
A: Interest on savings account is calculated on daily balance in the account.
Q: A particular credit card calculates interest using the unpaid balance method. The monthly interest…
A: Interest is calculated on unpaid balance method. Interest rate = 1.57% on the unpaid balance on the…
Q: A local financing bank granted a car loan to a man who agreed to pay a rate of interest of 25%.…
A: This question is based on deep discount loans where interest is charged upfront at the time sanction…
Q: To ensure that, along with spontaneous financing from accounts payable and accruals, adequate…
A: Here, The borrowed Amount is $600,000 Borrowing Limits is $1,000,000 Interest Rate of Line of Credit…
Q: A certificate of deposit (CD) is an agreement between a bank and a saver in which the bank…
A: formula for annual yield: AY=1+rnn-1where,r =rate n =frequency of compounding
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: Allied Bank pays 4% interest compounded annually on deposits, while bonkers Bank pays 3.5%…
A: The Effective Annual Rate: The effective annual rate is affected by the number of compounding…
Q: A credit card company charges a nominal 12% interest on overdue accounts, compounded daily. What is…
A: The formula for the calculation of effective rate is as follows: Effective interest rate=1+nominal…
Q: An automobile financier claims to be lending money at simple interest, but he includes the interest…
A: Following is the answer to the question
Q: A man borrows money from a bank which uses a simple discount rate of 14%. He signs a promissory note…
A: “Since you have asked multiple questions, we will solve the one question for you. If you want any…
Q: Springer Products wishes to borrow $90,000 from a local bank using its accounts receivable to…
A: Accounts receivable as collateral: If business utilizes its accounts receivable asset as…
Q: A company has borrowed $210,000 under a line-of credit agreement. It must pay a stated interest rate…
A: The loan can be taken from the organized banks and through the local lenders. The lender of the…
Q: A credit card company charges an interest rate of 1.375% per month on the unpaid balance of all…
A: Effective rate of interest is the real return on savings or any interest paying investment when…
Q: A payday loan is structured to obscure the true interest rate you are paying. For example, in…
A: Answer- Step 1 - Calculation of r - r = (FV/PV)^(1/n) - 1 Given, FV = 230 PV = 200 n = 1 Putting…
Q: Bank A pays 2% interest compoundedannually on deposits, while Bank B pays 1.75% compounded daily.a.…
A: Formula for EFF is: EFF = (1+r/n)^n - 1 where r is the nominal rate of interest & n is the…
Q: Jack Abrams borrowed $8,000 for nine months at an interest rate of 7% (simple interest). The bank…
A: Actual interest rate is computed below:
Q: Cash is borrowed on a 2-month note payable. If the interest cost to borrow is RO 400, and the cash…
A: The calculation of actual interest rate on the note is shown hereunder : Interest cost RO 400 Cash…
Q: .A bank offers a 272- day discounted loan at a simple discount rate of 12%. (a) How much money would…
A: The discount on loan is given and that discount on loan is the interest being charged on the loan…
Q: Marydale Products permits its customers to defer payment by giving personal notes instead of cash.…
A: Journal is a place where accounting transactions are listed in the book keeping system before ledger…
Q: a credit card has a 30-day billing period, a 20-day grace period, and charges an interest rate of…
A: In this case, we use the average daily balance method to calculate the interest charged. It is one…
Q: You are the loan department supervisor for a bank. This installment loan is being paid off early,…
A: Rebate fraction = No of payments remaining/Total no of payments Finance charge= Rebate fraction * […
Q: Bulldogs Inc. offered a one-year loan to a customer client. The instrument is a discounted note with…
A: Discount rate = 15%
Q: Hagar Company's bank requires a compensating balance of 10% on a $100,000 loan. If the stated…
A: Compensating balance: A compensating balance is a minimum amount of cash that must be maintained by…
Q: A payday loan is structured to obscure the true interest rate you are paying. For example, in…
A: “Since you have asked multiple question, we will solve the first question for you. If youwant any…
Q: American Express and other credit card issuers must by law print the Annual Percentage Rate (APR) on…
A: Effective Annual Rate: The effective annual rate (EAR) is the rate of interest or the real rate of…
Q: A loan of $2500 is taken out on May 12. It is to be paid back within a 1-year period with partial…
A: Declining balance method aims to calculate the amount of interest on the unpaid balance of loan on…
Q: A man borrows money from a bank which uses a simple discount rate of 14%. He signs a promissory note…
A: A promissory note refers to a financial instrument which contains a promise that one party will pay…
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- A customer was unable to pay the accounts receivable on time in the amount of $34,000. The customer was able to negotiate with the company and transferred the accounts receivable into a note that includes interest, along with an up-front cash payment of $6,000. The note maturity date is 24 months with a 15% annual interest rate. What is the entry to recognize this transfer?Credit card issuers must by law print the annual interest rate they charged borrowers. If the annual interest rate is stated to be 15%, with interest paid monthly, what is the actual annual cost that the bank charges its customers on the card?Springer Products wishes to borrow $90,000 from a local bank using its accounts receivable to secure the loan. The bank's policy is to accept as collateral any accounts that are normally paid within 30 days of the end of the credit period, as long as the average age of the account is not greater than the customer's average payment period. Springer's accounts receivable, their average ages, and the average payment period for each customer are shown in the following table: Customer Accounts Receivable Average age of account Average payment period of customer A $11,000 42 days 50 days B $25,000 70 days 65 days C $10,000 48 days 45 days D $28,000 55 days 50 days E $14,000 50 days 60 days F $19,000 21 days 35 days G $30,000 10 days 30 days H $16,000 25 days 40 days…
- Suppose that you owe $2,000 on a credit card that charges 18% APR and you pay either the minimum 10% or $20, whichever is higher, every month. How long will it take you to eliminate the debt? Assume that the bank uses the previous-balance method to calculate your interest, meaning that the bank does not subtract the amount of your payment from the beginning balance but charges you interest on the previous balance.Cumberland Furniture wishes to establish a prearranged borrowing agreement with its local commercial bank. The bank’s terms for a line of credit are 3.30% over the prime rate, and each year the borrowing must be reduced to zero for a 30-day period. For an equivalentrevolving credit agreement, the rate is 2.80% over prime with a commitment feeof 0.50% on the average unused balance. With both loans, the required compensating balance is equal to 20% of the amount borrowed. The prime rate is currently 8%. Both agreements have $4 million borrowing limits. The firm expects on average to borrow $2 million during the year no matter which loan agreement it decides to use. What is the effective annual rate under the line of credit? b. What is the effective annual rate under the revolving credit agreement? (Hint: Compute the ratio of the dollars that the firm will pay in interest and commitment fees to the dollars that the firm will effectively have used of.) If the firm does expect to borrow…A bank is offering a loan of $20,000 with an interest rate of 9%, payable with monthly payments over a 4-year period. a. Calculate the monthly payment required to repay the loan. b. This bank also charges a loan fee of 4% of the amount of the loan, payable at the time of the closing of the loan (that is, at the time the borrower receives the money). What effective interest rate is the bank charging?
- On March 20, the Agricultural Bank deducted engineer Valdez a rate of 18% annual simple in a document that expires on the following November 15, said document was signed on January 22 to guarantee a credit of 40,000. On June 12, the bank transfers the document to Banco Mercantil with a simple 16% annual discount. How much was the profit for the Agricultural Bank?Holland Construction Company has an outstanding 180-day bank loan of $393,000 at an annual interest rate of 9.7%. The company is required to maintain a 14% compensating balance in its checking account. What is the effective interest rate on the loan? Assume the company would not normally maintain this average amount.Heirloom needs to borrow from a local bank for corporate short-term operating purposes. It is willing to pledge unpaid contracts as collateral for a loan. A local bank president is willing to lend Heirloom up to 70% of the value of notes receivable that are not more than 60 days overdue. Heirloom must also provide, by the fifth day of each month, a note receivable aging list for the preceding month and a calculation showing the maximum amount Heirloom may borrow under the agreement. Figure 5-3 shows the employees and external parties that deal with Heirloom. Explain how Heirloom could defraud the bank and how each internal and external party, except the bank, could defraud Heirloom. What risk factor, unusual item, or abnormality would alert you to each fraud? What control weaknesses make each fraud possible? Recommend one or more controls to prevent or detect each means of committing fraud.
- BPI granted a 10-year loan to a borrower in the amount of ₱1,500,000 with stated interest rate of 6%. Payments are due monthly and are computed to be ₱16,650. The bank incurred ₱40,000 of direct loan origination cost and ₱20,000 of indirect loan origination cost. In addition, the bank charged the borrower a 4-point nonrefundable loan origination fee. What is the carrying amount of the loan receivable to be reported initially by the bank?A person borrows $3,000 on a bank credit card at a nominalrate of 18% per year, which is actually charged at a rate of1.5% per month. a. What is the annual percentage rate (APR) for the card?(See Example 5.6.8 for a definition of APR.) b. Assume that the person does not place any additionalcharges on the card and pays the bank $150 eachmonth to pay off the loan. Let Bn be the balance owedon the card after n months. Find an explicit formulafor Bn . c. How long will be required to pay off the debt? d. What is the total amount of money the person will havepaid for the loan? If you could please answer b and d for me I put the other 2 questions there in cases they where somehow apart of b and dA certificate of deposit (CD) is an agreement between a bank and a saver in which the bank guarantees an interest rate and the saver commits to leaving his or her deposit in the account for an agreed-upon period of time. First National Bank offers 2-year CDs at 9.12% compounded daily, and Citywide Savings offers 2-year CDs at 9.13% compounded quarterly. Compute the annual yield for each institution and determine which is more advantageous for the consumer. (Round your answers to two decimal places.) FNB: r = % CS: r = % who has the better offer.
