Question
Robert Inc offered a 3/10 net 40 trade discount by its supplier. in the past Robert has been able to get away with paying for
Robert Inc offered a 3/10 net 40 trade discount by its supplier. in the past Robert has been able to get away with paying for supplies on credit in 60 days . since it doesn't have money on hand to take advantage of the discount it tries to negotiate a loan with Third Bank. the total amount of the loan is $375,000 and will require a 15% compensation balance and a $5,500 interest charge has been negotiated for the month of May (31 days) Robert already maintains a $16,250 balance at the bank.
A) What js the cost of not taking the discount? ( Percentage rounded to 2 decimal places ex 24. 35%)
B) What is the annual rate of interest on the loan? (percentage rounded to 2 decimal places)
C) Which one should Brand Take? 1.Take the loan from the bank. 2. Don't take the discount.
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