BioTron Medical, Inc. Brent Bush, CFO of a medical device distributor, BioTron Medical, Inc, was approached by Japanese customer, Numata, with a proposal to pay cash (in Yen) for its typical orders of 12,500,000 every month

if it were given a 4.5% discount. Numata's current terms are 30 days with no discounts. Using the following quotes and estimated cost of capital for Numata, Bush will compare the proposal with covering yen payments with forward

contracts. Should Brent Bush accept Numata's proposal?

Spot rate:111.40/$30 day forward rate

111.00/$90 day forward rate

110.40/$180 day forward rate

109.20/$Numata's WACC8.85%BioTron's WACC9.20%