DISCOUNTING CHEQUE The customer pays in USD by a cheque maturity 1 year Komsis takes this cheque to a factoring company for discounting Factoring company applies 6 discounting rate to the face value of the cheque They also charge 1 5 commission on the cheque amount They will pay Komsis in $ QUESTION A What is the discounted value of the cheque B How much will factoring company pay to Komsis FORIGN CURRENCY EXCHAGE FX RATES BANK NOTE RATES USD TL DATE BUY RATE SELL RATE BUY RATE SELL RATE 01 03 2018 3,8082 3,8150 3,8055 3,8208 Extra info GENERAL TERMS The music sets have same configuration No variaties in configuration KOMSIS has strong financial reputation in the market and a very good network in the country to sell the goods with good profit margin KOMSIS can sell goods in TL or Foreign Currency (FCY) KOMSIS doesnt have any problem to sell the music sets They can sell them any time, with any method which is more profitable for them Importing is the same, they can make imports with any method they want IMPORT DETAILS KOMSIS is buying 10 000 music sets , cost per set is $ 400 FOB Transportation of the music sets from China to Turkey will cost $ 112 750 It is payable at Documents Receipt date by Akbank , in TL countervalue of $ amount Insurance will be $ 40 250 which is also payable at document receipt date and in TL All costs will be paid by KOMSIS Transportation from airport to company warehouse will cost TL 15 000 Customs taxes and duties will be TL 665 000 Transaction date is March 01 Everything will be settled on March 01 FINANCING KOMSIS has 2 options of financing in their hand Now management will decide on which transaction they will go for Please use correct Foreign Exchange rate provided below for your calculations KOMSIS is working with AKBANK They do not have any financing issues They have enough money with the bank In this environment, there are no other taxes except Corporate Income Tax of domestic sales profit You dont need to calculate the Corporate tax

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Oct 04, 2024

DISCOUNTING CHEQUE

The customer pays in USD. by a cheque maturity 1 year. Komsis takes this cheque to a factoring company for discounting.
Factoring company applies % 6 discounting rate to the face value of the cheque. They also charge % 1.5 commission on the cheque amount.
They will pay Komsis in $.

QUESTION : A. What is the discounted value of the cheque ?

B. How much will factoring company pay to Komsis ?

Extra info:

GENERAL TERMS

The music sets have same configuration. No variaties in configuration.
KOMSIS has strong financial reputation in the market and a very good network in the country to sell the goods with good profit margin.
KOMSIS can sell goods in TL or Foreign Currency (FCY).
KOMSIS doesnt have any problem to sell the music sets. They can sell them any time, with any method which is more profitable for them. Importing is the same, they can make imports with any method they want.

IMPORT DETAILS

KOMSIS is buying 10.000 music sets , cost per set is $ 400 FOB.
Transportation of the music sets from China to Turkey will cost $ 112.750 It is payable at Documents Receipt date by Akbank , in TL countervalue of $ amount.
Insurance will be $ 40.250 which is also payable at document receipt date and in TL.
All costs will be paid by KOMSIS.
Transportation from airport to company warehouse will cost TL. 15.000
Customs taxes and duties will be TL.665.000
Transaction date is March 01. Everything will be settled on March 01.

FINANCING

KOMSIS has 2 options of financing in their hand. Now management will decide on which transaction they will go for.
Please use correct Foreign Exchange rate provided below for your calculations
KOMSIS is working with AKBANK. They do not have any financing issues. They have enough money with the bank.

In this environment, there are no other taxes except Corporate/Income Tax of domestic sales profit. You dont need to calculate the Corporate tax