Q: what is the benefit cost ratio?
A: net present value revenue = 1.5 cost revenue - cost = NPV 1.5cost -cost = 250000 cost = 500000…
Q: Which of he following stalements BEST describes the primary difference between a Health Maintenance…
A: A Health Maintenance Organization is a form of health insurance where the medical care is insured if…
Q: Consider an Australian investor who borrows money in pounds from a UK bank at an interest rate of…
A: Here, Borrowing Interest Rate of Pound is 3.9% Increase in the Price of Australian Shares is 4%…
Q: Your company is contemplating replacing some current machinery with more energy efficient models.…
A: NPV is the difference between present value of all cash inflows and initial investment. NPV =PV of…
Q: Learning Task 2: Journalize the entries for the following adjustments on December 31, the ed o the…
A: Journal entries is referred as an act of the keeping/making records for all the transaction of the…
Q: 1. You deposited $1000 into a savings plan at the end of each year for 3 years. The rathe is 8% per…
A: Principal Amount,P = $1,000 Interest Rate,I = 8% = 0.08 Number of years, N= 3 years Future Value of…
Q: FedEx Corp. stock ended the previous year at $103.39 per share. It paid a $0.35 per share dividend…
A: The question is related to the return. Return is calculated with the help of following formula…
Q: ACME Car Wash has the option to invest in one of the following two vehicle dryer systems. MARR is…
A: Data given: Vehicle Dryer 1 Vehicle Dryer 2 Capital Investment ($) 145000 157000 Net Annual…
Q: 30 You hope to buy your dream house six years from now. Today your dream house costs $189,900. You…
A: Future value of dream house = PV * (1+r)^nWhere PV = Present Valuer = Average rise in pricesn =…
Q: 8 years from now Jennifer will need $750,000 to renovate a rental property at interest rate of 9%…
A: The time value of money concept is applied to determine the equated instalment amount of deposit to…
Q: A father is now planning a savings program to put his daughter through college. She is 13, plans to…
A: This is a time value of money concept based question. There is a quantum of funds required for…
Q: Not use excel Q)Payments of $1,700 in 1 year and another $2,100 in 5 years to settle a loan are to…
A: The Present Value and Future Value of money: The value of a sum of money expected to be received in…
Q: Holding the APR constant, as the number of compounding periods per year increases, the periodic rate…
A: Present value of an amount to be received in future can be calculated as: = Future amount/ (1 + rate…
Q: Long-term and short-term finance tends to be differentiated by: the amount of finance raised.…
A: Companies can raise finance for long term or for short term. As the name indicates it is the word…
Q: A and 40% B. Compute the coefficient Estimate the market model equations for both stocks and
A: ERi=Rf+βi(ERm−Rf) where:ERi=expected return of investment Rf=risk-free rate βi=beta of the…
Q: During the first month of operations, the following transactions occurred for Blossom Inc.: Apr. 1…
A: Journal Entries
Q: A cash flow has the following income values: $100 at end of year 2, $200 at end of year 3, $300 at…
A: Given, The interest rate is 11% per year.
Q: At what interest rate will ₱30,750 amount to ₱44,875 in 4 years and 6 months, if interest is…
A: Data given: Description Data FV (P) 44875 PV (P) 30750 r= rate (Compounded semiannually)…
Q: Maintenance money for an athletic complex has been sought. Mr. Kendall, the Athletic Director, would…
A: Time value of money (TVM) refers to the method or technique which is used to measure the amount of…
Q: Determine the present value of an annuity of $600 paid monthly for a period of 15 years at 4.50% APR…
A: To calculate the present value we will use the below formula Present value = P*[1-(1+r)-n]/r Where…
Q: When compleling an insurance applicalion, a producer should A. complete as much of the application…
A: The job of the producer is to make sure that the applicant knows all the features of the insurance…
Q: Seth Bullock, the owner of Bullock Gold Mining, is evaluating a new gold mine in South Dakota. Dan…
A: The net present value is the method of finding the profitability of the project by adding up…
Q: An example of an ‘intermediate good’ would be: the petrol purchased by consumers for their…
A: Intermediate goods are goods that are used as a factor of production to create goods that can…
Q: what is the project's NPV? Options
A: Net Present Value: It is the present worth of the project and measures absolute profitability in…
Q: One-year Treasury bill rates over the next five years are expected to be 5%, 6%, 7%, 8%,and 9%. The…
A: “Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: A project will have annual operating cash flows of $36,500 for four years. At the beginning of the…
A: Net Present Value (NPV) = Present Value of Cash Inflows - Initial Investment
Q: For how long can you withdraw $500.00 at the end of each month out of a fund of $10,000 deposited…
A: Present Value of Deferred Annuity refers to the concept which dictates the discounted value of a sum…
Q: A simple "EE US Treasury Savings Bond" pays the holder $1000 in 30 years. Given that the applicable…
A: To calculate the bond cost we will use the below formula Bond cost today = FV/[1+(r/m)]n*m Where…
Q: 22 OLG stock has a beta of 0.98 and an expected return of 10.52 percent. The risk-free rate of…
A: The capital asset pricing model is used for pricing securities and calculating their expected…
Q: a) What single investment made today, earning 12% annual interest, will be worth $6,000 at the end…
A: The question is related to Time value of money. The present value is calculated with the help of…
Q: A cash flow has the following income values: $100 at end of year 2, $200 at end off year 3, $300 at…
A: Present value of future amount The present value (PV) of a future value (FV) is calculated as shown…
Q: is working on following two mutually exclusive proposals for in d optimizing the traffic lighting.…
A: Benefit cost ratio is used for financial analysis of long term projects and it must be more than 1…
Q: what would have been the maximum amount that should be invested? Use interest rate of 9% compounded…
A: A stream of equal cash flows (CF) paid or received periodically is termed as annuity. Ordinary…
Q: You are an analyst for a large public pension fund and you have been assigned the task of evaluating…
A: Alpha of fund-The extra returns over the market benchmark for a given amount of risk taken by the…
Q: Refer to the Balance Sheet, what is the company's asset to equity? TABLE P3.2 Balance Sheet, Cyclone…
A: Balance Sheet: A balance sheet is a statement which provides financial data related to the assets,…
Q: An elevator system for a 15-yr old high-rise office building cost P 18M when first installed. The…
A: On the basis of the information provided: Cost of an elevator system - P 18M Useful life (years) -…
Q: The pressures on the foreign exchange market are such that they cause the British pound to…
A: In this question, the pressure on the foreign exchange market causes the British Pound to depreciate…
Q: Black-Scholes. A European call style option is made for a security currently trading at $ 55 per…
A: Here, To Find: Using Black Scholes Model Call Option Price =? Put Option Price =?
Q: Microsoft invests in google by buying shares worth $50 million, this is an example of O Capital…
A: Whenever a company invests in pother company it is expanding its activity. It is making an…
Q: How to make a personal financial statement?
A: Personal Dinancial statement is a summary statement of individual financial position, it contains…
Q: 4. You borrowed $10,000 on a 10% discounted loan for a period of 8 months. a. What is the loan's…
A: Mortgage/ Borrowings: Borrowings are the loan which is taken by the individual to meet its…
Q: Over the last 10 years, a firm has had the earnings per share shown in the following table: Year…
A: A. Calculate the annual dividend for 2017 as follows: Annual dividend = Earnings per share *…
Q: Rajesh would like to buy his first car and the one he has his eye on is $25,000, plus an extra 13%…
A: Solution:- When a loan is taken, it can either be repaid as a lump sum payment or in instalments.…
Q: are and contrast the roles and functions of capital markets and
A: There are two types of market for raising money and trading of securities in the market capital…
Q: High Roller Properties is considering building a new casino at a costof $10 million at t = 0. The…
A: Data given: Cost of new casino (at t=0) = $10 million WACC = 11% Cash flow with tax=$1.875 million…
Q: The common stock of Auto Deliveries sells for $28.16 a share. The stock is expected to pay $1.3 per…
A: We will apply the concept of dividend discount model here. As per the dividend discount model the…
Q: In 1988 the average tuition for one year at an Ivy League school was $1,800 (PV). Thirty years…
A: Value of money declines with the passage of time due to various factors like inflation rate and due…
Q: 1. $1500 is invested semi-annually for 3 years into a fund that pays 6.8% per year, compounded semi-…
A: Solution:- Annuity means an equal amount invested each period.
Q: what is the par value of the bond?
A: Bond valuation refers to a method which is used to compute the current value or present value (PV)…
Q: You wish to save P2,500,000 for your retirement by saving a certain sum every month for the next 40…
A: Future Value of Annuity Due refers to the concept which dictates the compounded value of a sum of…
Question 10
If a supplier is offering trade credit of 1/10 net 30, and a buyer chooses not to take the discount, when should they pay, assuming that they wish to stay on good terms with the supplier?
|
On day 10 |
||
|
On day 30 |
||
|
Any time before day 10 |
||
|
Any time after day 30 |
Step by step
Solved in 3 steps
- Assume the credit terms offered to your firm by your suppliers are 4/15, net 30. Calculate the cost of the trade credit if your firm does not take the discount and pays on day 30BUS 038 : Business Computatns12. For terms of 6/10, n/30, what annual rate do you pay the supplier if you fail to pay the invoice at the end of the discount period?QUESTION 11 The credit policy of Home Living Stores is 2/10 net 30. At present 25% of customers take advantage of the discount, 55% pay within the net period, and the remainder pay within 42 days of invoice. What will the effect on receivables be if all customers take the discount? cannot be determined lower than the present level higher than the present level no change from the present level
- Assume the credit terms offered to your firm by your suppliers are 2/15, net 30 . Calculate the cost of the trade credit if your firm does not take the discount and pays on day 30 . (Hint: Use a 365 -day year.)BUS 038 : Business Computations7. For terms of 8/10, n/60 determine the annual rate you, in effect, pay the supplier if you fail to pay the invoice at the end of the discount period. Express the rate with 2 decimal places. 8. An invoice for $75.20 has terms of 3/10, 1/30, n/60. If you make payment 25 days after the invoice date, what amount should you pay? 9. You purchase goods on an invoice dated July 5 with terms of 4/15, n/45 ROG. If you receive the goods on July 23, calculate (a) the last day of the discount period, and (b) the last day of the credit period. b. Last day of credit period:Captain Whitman Ship Supplies offers terms of 3/15, net 45. If a purchaser takes the discount and pays on the 10th day, what is the nominal cost of trade credit? Now suppose a purchaser actually pays on the 20th day but still takes the discount. What is the actual nominal cost of the trade credit?
- Q3) Discount Sales = $24m Credit Terms = 2/10, net/30 Borrowing rate = 17% 30% customers will avail discount and 70% will not avail. Is this a viable proposition?Credit terms with a new supplier are 2/10, net 30 If unable to pay within the discount period and pay the cash price, what is the Effective Cost of Trade Credit (EFF%) if paid in 20 days? Group of answer choices 87.2449% 74.4898% 105.4367% 109.0491% 76.6667%P15–6 Early payment discount decisions Prairie Manufacturing has four possible suppliers, all of which offer different credit terms. Except for the differences in credit terms, their products and services are virtually identical. The credit terms offered by these suppliers are shown in the following table. (Note: Assume a 365-day year.) Supplier Credit terms J 1/5 net 30 EOM K 2/20 net 80 EOM L 1/15 net 60 EOM M 3/10 net 90 EOM Calculate the approximate cost of giving up the early payment discount from each supplier. If the firm needs short-term funds, which are currently available from its commercial bank at 9%, and if each of the suppliers is viewed separately, which, if any, of the suppliers’ early payment discounts should the firm give up? Explain why. Now assume that the firm could stretch by 30 days its accounts payable (net period only) from supplier M. What impact, if any, would that have on your answer in part brelative to this supplier?
- i will 5 upvotes urgent Company A is currently cash-constrained, and must make a decision about whether to delay paying one of its suppliers, or taking out a loan. They owe the supplier $13,645, but the supplier will give them a 3.46% discount if they pay in the first 14 days (when the discount period expires). That is, they can either take the discount by paying in the first 14 days, or $13,645 in 2 month(s) when the net invoice is due. What would be the cost for the firm if they forgo the discount on its trade credit agreement, wait and pay the full $13,645 in 2 month(s)?Question 36 A company has daily purchases of $10,000 from its supplier. The supplier offers trade credit under the following terms: 3/20, net 50 days. The company finally chooses to pay on time (pay in the 50th day) but not to take the discount. We assume 365 days per year. What is the average level of the company’s free trade credit? ______ $30,000 $170,000 $200,000 $300,000 Question 37 Based on the information from Question 36, what is the average level of the company’s total trade credit? $170,000 $200,000 $300,000 $500,000 38 . Based on the information from Question 36, what is the average level of the company’s costly trade credit? $170,000 $200,000 $300,000 $500,000 Question 39 Based on the information from Question 36, what is the nominal annual cost of the firm’s costly trade credit? 28.6% 29.3% 33.5%…Entity B's current sales on credit: 28,240Collection period: 3 monthsMarket interest rate: 25%The company is considering to apply the 6/7 net 30 policy due to the excessive competition in the sector. It is estimated that 45% of customers can take advantage of this situation and the collection period will be reduced to 1.5 months. 1) What is the additional cost of the cash discount to the firm?a) 1,212,1b) 1,199.9c) 2,666.4d) 762.5e) 856.7 2) What is the additional benefit of the cash discount? 3) Should the entity apply the cash discount or not?
