a. Terminal warehouse receipt loan from a finance company. Terms are 12 percent annualized with an 80 percent advance against the value of the inventory. The warehousing costs are $7,000 for the Bmonth period. The residual financing requirement, which is $400,000 less the amount advanced, will need to be financed by forgoing cash discounts on its payables. Standard terms are 2/10, net 30; however, the company feels it can postpone payment until the fortieth day without adverse effect.