BrightFoods Inc. is analyzing its working capital financing options. The company has current assets of $500,000 and current liabilities of $300,000. BrightFoods can secure a short-term loan at an interest rate of 8% or issue commercial paper at an interest rate of 6%. Calculate the cost of financing using both options and analyze the most cost-effective solution for BrightFoods.

Calculate the cost of financing using short-term loans and commercial paper and analyze the most cost-effective solution for BrightFoods.