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12d PLEASE ANSWER D. Neveready Flashlights Inc. needs $375,000 to take a cash discount of 2/18, net 80. A banker will loan the money for
12d
PLEASE ANSWER D.
Neveready Flashlights Inc. needs $375,000 to take a cash discount of 2/18, net 80. A banker will loan the money for 62 days at an interest cost of $12,100 a. What is the effective rate on the bank loan? (Use a 360-day year. Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.) Effective rate of interest 18.741%) b. How much would it cost (in percentage terms if the firm did not take the cash discount but paid the ill calculations. Input your answer as a percent rounded to 2 decimal places.) 60 days instead 0 18 days? se a s a, ear. D not r und me mediate Cost of not taking a cash discount 11 851 c. Should the firm borrow the money to take the discount? Yes d. If the banker requires a 20 percent compensating balance, how much must the firm borrow to end up with the $375,000? Amount to be borrowed Neveready Flashlights Inc. needs $375,000 to take a cash discount of 2/18, net 80. A banker will loan the money for 62 days at an interest cost of $12,100 a. What is the effective rate on the bank loan? (Use a 360-day year. Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.) Effective rate of interest 18.741%) b. How much would it cost (in percentage terms if the firm did not take the cash discount but paid the ill calculations. Input your answer as a percent rounded to 2 decimal places.) 60 days instead 0 18 days? se a s a, ear. D not r und me mediate Cost of not taking a cash discount 11 851 c. Should the firm borrow the money to take the discount? Yes d. If the banker requires a 20 percent compensating balance, how much must the firm borrow to end up with the $375,000? Amount to be borrowedStep by Step Solution
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