The present rate for deutsche marks per dollar is 1.79 and 90-day forward rate is 1.78. Compute the annualized discount rate in dollar assuming 365 days in a year. A. -2.266% B. -2.37% C. -2.97% D. -2.164% Answer OB D]

The present rate for deutsche marks per dollar is 1.79 and 90-day forward rate is 1.78. Compute the annualized discount rate in dollar assuming 365 days in a year. A. -2.266% B. -2.37% C. -2.97% D. -2.164% Answer OB D]

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 14MC: Ancient Grains Unlimited has an accounts receivable turnover ratio of 3.34 times. The net credit...

See similar textbooks

Related questions

Q: Given Principal $14,500, Interest Rate 8%, Time 240 days (use ordinary interest) Partial…

A: The amount of interest expenses refers to the fixed payment made by the borrower. It is charged at a…

Q: If the stated annual rate of interest compounded semi-annually is 12.5% then what is the equivalent…

A: Equivalent interest rates are interest rates that produce the same return as the given annual…

Q: On average, how much “free” trade credit does the firm receive during the year?

A: Free trade credit refers to the payment made by a firm within the discount period whereas when the…

Q: The approximate effective cost (EC) of financing the discount price of trade credit under terms…

A: Discount (d) = 2% for 10 days and then net on last day, which is day 30. Total days (T) = 30…

Q: Company X sells on a 3/10, net 90, basis. Company Y buys goods with an invoice of $2,500. a. How…

A: Calculation of Deduction Amount, Extra Credit Days and Effective Annual Rate: Excel Spreadsheet:…

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

A: Free Trade credit refers to a type of financing wherein the buyer gets a credit period of…

Q: Give your answers rounded to 6 decimal places in the following questions. Given that the effective…

A: As you have asked multiple questions we will solve the first question as per policy. Please ask…

Q: he following: Spot USDBRL = 5.0500 1YR USD Money Market Rates = 1.50%…

A: The interest rate and exchange rates are related to each and changes with changes in the interest…

Q: What is the nominal annual percentate cost of the non-free trade credit if it pays within 120 days…

A: Nominal annual % cost of non-free trade credit = [ { Discount / ( 1 - Discount ) } x { 365 / ( Days…

Q: Company X sells on a 2/10, net 90, basis. Company Y buys goods with an invoice of $1,500. a. How…

A: Given values: Invoice value = $ 1500 if paid within 10 days discount = 2% with in 90 days it should…

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

A: Credit financing is a type of financing in which a purchase is made on credit, that is, the purchase…

Q: If a company purchases merchandise on terms of 2.7/10, n/30, the cash discount available (assuming a…

A: Accounting is primarily concerned with identifying, recording, measuring, summarizing transactions…

Q: 17. Compute the rate (in %) for the loan. Round answers to the nearest tenth of a percent; use…

A: Principal = $54000 Interest rate = r Period = 60 days Interest = $864

Q: A debt of $7311.92 is repaid by payments of $1795.22 in 8months ,$1002.19 in 17months, and a final…

A: The future value of amounts shows the compounded worth of the current amount. It can be calculated…

Q: What is the effective annual rate (EAR) for a nominal rate (monthly compounding) of 9.00%? 9.4130%…

A: Nominal rate = 9% Compounding = monthly

Q: Calculate the quarterly compounded rate (j4) equivalent to a monthly compounded rate of 8.70% (j12).…

A: Given: Monthly compounded rate =8.70% Effective annual rate = (1+ rm/ n)n -1 where rm = rate for…

Q: A firm is offered trade credit terms of 3/15, net 30 days. The firm does not take the discount, and…

A: Note: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question…

Q: Insert an answer for each of the following p= $ 3,200, r=.023, t= 3months. interest ?…

A: solution answer to 1 interest =p * r * 3/12 =$3200 *…

Q: The present rate for deutsche marks per dollar is 1.79 and 90-day forward rate is 1.78. Compute the…

A: Forward contract- It is an over-the-counter derivative contract between the two parties to buy or…

Q: ECEIVABLES INVESTMENT Ewan Industries sells on terms of 3/10, net 40. Total sales for the year are…

A: Average amount of receivables = total sales × days sales outstanding/365

Q: A 91-day Treasury Bill with a face value of $150,000 is sold to yield 3.01 % p.a. What is the…

A: A T-Bill is a money market instrument issued by the Treasury. The maturity date of such bills is…

Q: On a 365-day basis, what is the effective annual rate of using trade credit if terms are 2/10, net…

A: If the payment is done in 10th day, the discount is given for 2 else full payment is required if…

Q: Principal $10,000, Interest Rate 89%, Time 240 days (use ordinary interest) Partial payments: On…

A: When a partial payment is paid, the amount of payment will first reduce the interest obligations and…

Q: On a 36-day basis, ir payment is made on the twentieth day under trade credit turms of 2/10, net 30.…

A: Liability: Liability is an obligation of any business. It is an amount borrowed by a business from…

Q: 4. Estrada V. Escritor sells on terms 3/10, net 30. Total sales for the year are ₱2,539,130. Forty…

A: Accounts receivables are those customer accounts to whom business has made credit sales on account…

Q: 6. GFB Co. buys on terms of 2/15, net 30 days. It does not take discounts, and it typically pays 30…

A: Free trade-credit gives no cost to the company.

Q: Newsome inc. buys on terms of 3/15, net 45. It does not take the discount, and it generally pays…

A: Financial Management: Financial management comprises of two words i.e. Finance and management.…

Q: You would like to purchase a Treasury bill that has a $16,500 face value and is 62 days from…

A: Face value (F) = $16500 Price (P) = $16375 n = 62 days

Q: A firm is offered trade credit terms of 3/15, net 30 days. The firm does not take the discount, and…

A: SOLUTION- WORKING- NUMBER OF DAYS ARE THERE PER PERIOD IS 50-15 = 35 DAYS.

Q: National Co. borrowed P100,000 for six months from the percent. The prime rate was 8.5 percent at…

A: In this question we have to calculate interest on national co. for the 6 months

Q: Treasury bills with a nominal value of TL 1.000, which are 280 days to maturity, to 867 What is the…

A: Annual interest rate = [(Nominal value - purchase price)/purchase price] x 365/260

Q: HBC Inc. buys on terms of 2/10, net 30 days. It does not take discounts, and it typically pays 30…

A: Trade Discount: Providing a trade discount is a good approach to capture a customer's attention by…

Q: A 3 month $19,000 treasury bill with a simple annual discount rate of 0.27% was sold in 2016. Assume…

A: Given information: Simple annual discount rate is 0.27% Principal amount is $19,000 Time period is 3…

Q: Sales discounts with terms 2/10, n/30 meana. 10 percent discount for payment received within30 days…

A: Sales discount: Sales discount is the cash discount which is given by the seller to the buyer if the…

Q: On a 365-day basis, what is the rate per period of using trade credit if terms are 2/10, net 30, and…

A: Here, Credit Terms is 2/10 net 30 Payment is made on the 20th day Days in an year is 365

Q: 10. Your company has been offered credit terms of 4/30, net 90 days. What will be the nominal annual…

A: Given:

Q: Determine the interest to be deducted in advance if P 50 000 is due after 6 months with a discount…

A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…

Q: ind the nominal annual rate of interest compounded quarterly that is equivalent to 4.1% compounded…

A: In this we have to calculate the effective rate of both options and than calculate quarterly…

Q: Handley Bank advertises that its standard lending rate is 12% per annum compounding quarterly. Which…

A: The effective annual rate of interest is the actual or the real rate of interest paid or received…

Q: iven Principal $ 13,000, Interest 5%, Time 240 days (use ordinary interest)…

A: Interest is the amount charged by bank in consideration of advancing loan to its borrowers. It is…

Q: Find the Discount value on BHD 20400 at the end 650 days if it is invested at 2% compounded…

A: Discounted value is the present value of an investment in today’s term. It is the value which is…

Q: A bank offers an APR of 3.25% compounded semiannually.Find the annual percentage yield (APY). 3.28%…

A: APR = 3.25% Compounded Semi annually Interest rate for semiannual period(r) = 3.25%/2 = 1.625%…

Q: The present rate for deutsche marks per dollar is 1.79 and 90-day forward rate is 1.78. Compute the…

A: The annualized forward discount rate is the rate at which the forward price of a currency is less…

Q: Compsny X sells on a 1/15, net 90, basis. Company Y buys goods with an invoice of $3,000. Discount=…

A: Effective rate of return: The rate of interest on an investment annually when compounding occurs…

Q: followed by 17 payments of $5800 each at the begin of quarter. What interest rate il is being…

A: The time worth of cash draws from the possibility that reasonable financial backers like to get cash…

Question

The present rate for deutsche marks per dollar is 1.79 and 90-day forward rate is 1.78.
Compute the annualized discount rate in dollar assuming 365 days in a year.
A. -2.266%
B. -2.37%
C. -2.97%
D. -2.164%
Answer
O B
Submit
search
1O
Inser
C12
Home
End

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Discount rate:

VIEW

Excel:

VIEW

Answer:

VIEW

Step by step

Solved in 3 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

If a firm buys on terms of 3/15, net 45, but actually pays on the 20th day and still takes the discount, what is the nominal cost of its nonfree trade credit? Does it receive more or less credit than it would if it paid within 15 days?
Ancient Grains Unlimited has an accounts receivable turnover ratio of 3.34 times. The net credit sales for the year are $567,920. What is the days sales in receivables ratio for 2018 (rounded to the nearest whole number)? A. 190 days B. 109 days C. 110 days D. 101 days
Calculate the nominal annual cost of nonfree trade credit under each of the following terms. Assume that payment is made either on the discount date or on the due date. a. 1/15, net 20 b. 2/10, net 60 c. 3/10, net 45 d. 2/10, net 45 e. 2/15, net 40
The present rate for deutsche marks per dollar is 1.79 and 90-day forward rate is 1.78. Compute the annualized discount rate in dollar assuming 365 days in a year. A. -2.26 B. -2.3 C. -2.9 D. -2.16 4%7%7%6% -2.164%
If the annualized cost of the trade credit discount is 7.37%, what is the net trade credit period? Assume a discount percentage of 1% for payments received on or before 20 days. Select one: a. 20 days b. 30 days c. 50 days d. 70 days
Queen Corp sells on terms of 2/10, n/30. 70% of customers normally avail of the discounts. Annual sales are P900,000, 80% of which is made on credit. Cost of approximately 75% of sales. Use 360 days. What is the average investment in receivable?
McEwan Industries sells on terms of 3/10, net 20. Total sales for the year are $971,000; 40% of the customers pay on the 10th day and take discounts, while the other 60% pay, on average, 90 days after their purchases. Assume 365 days in year for your calculations. What is the days sales outstanding? Round your answer to two decimal places. days What is the average amount of receivables? Do not round intermediate calculations. Round your answer to the nearest cent. $ What is the percentage cost of trade credit to customers who take the discount? If your answer is zero, enter zero. Round your answer to two decimal places. % What is the percentage cost of trade credit to customers who do not take the discount and pay in 90 days? If your answer is zero, enter zero. Do not round intermediate calculations. Round your answers to two decimal places. Nominal cost: % Effective cost: % What would happen to McEwan’s accounts receivable if it toughened up on its collection…
A 1,000 Treasury bills with 91 days period can be purchased at 995. What is the annualized discount rate? A• 5% B• 60% C• 2% D• 1.98%
If a firm buys under terms of 1/15, net 40, but actually pays on the 20th day and still takes the discount, what is the nominal cost of its nonfree trade credit? Assume a 365-day year. Do not round intermediate calculations. Round your answer to two decimal places.
A one-year floating-rate note pays 6-month Libor plus 90 bps. The floater is priced at 98.67 per 100 of par value. Current 6-month Libor is 1.17%. Assume a 30/360 day-count convention and evenly spaced periods. What is the annual discount margin for the floater in basis points?
Assume the following annual payments of notes payable of Demi Company with 10% discount rate. 1st Year - P300,0002nd Year - P200,000 3rd Year - P400,000 What is the present value of the annual payments?
Salma Corporation sells on terms of net/90. Their accounts receivable are on average 20 days past due. If annual credit sales are P800,000, what is the company’s average investment in accounts receivable? choose the letter of correct answera. P44,444.00b. P144,444.00c. P224,444.00d. P244,444.00e. P344,444.00