< Back to Assignment Attempts: 3. Problem 15.03 Keep the Highest: /5 Click here to read the eBook: Accounts Payable (Trade Credit) Click here to read the eBook: Bank Loans Problem Walk-Through COST OF TRADE CREDIT AND BANK LOAN Lancaster Lumber buys $8 million of materials (net of discounts) on terms of 3/5, net 50; and it currently pays on the 5th day and takes discounts. Lancaster plans to expand, which will require additional financing. Assume 365 days in year for your calculations. Round your answer to the discounts, how much additional credit could it obtain? Write out your answer completely. For example, 5 million should be entered as 5,000,000. $ to the nearest cent. b. What would be the nominal cost of that credit? Do not round intermediate calculations. Round your answer to two decimal places. % c. What would be the effective cost of that credit? Do not round intermediate calculations. Round your answer to two decimal places. % d. If the company could get the funds from a bank at a rate of 7%, interest paid monthly, based orta 365-day year, what would be the effective cost of the bank loan? Do not round intermediate calculations. Round your answer to two decimal places. % e. Should Lancaster use bank debt or additional trade credit? -Select-