=+LG 1 LG 6 P16–20 Inventory financing Heidelberg Cement faces a liquidity crisis: It needs a loan of

€1,000,000 for 2 months. Having no source of additional unsecured borrowing, the firm must find a secured short-term lender. The firms’ accounts receivable are quite low, but its inventory is considered liquid and reasonably good collateral. The book value of inventory is €2,000,000 of which €1,500,000 is finished goods. (Note:

Assume a 365-day year.)