The Changyong Enterprise needs to increase its working capital by Rs 900,000, for which it obtains a terminal warehouse loan from the Gwadar Financing Limited for 6 months. The terms stipulate a 6 percent annualized interest rate, with a 40% advance against the value of the inventory currently valued at Rs 1.8 million. The warehouse costs are Rs 12,000 per month. The residual financing requirements will be financed by forgoing some cash discount on its payables, for which standard terms are 3/5 n/45, although, the Changyong feels that it can safely postpone payments until the 50th day without any adverse effect.

Required

[a] Calculate the interest and principle amount on the loan secured against the inventory.

[b] Calculate the residual loan required on the forgone discount on payable payments.

[c] Calculate the effective annual rate of the discount forgone on payables, as per the terms of agreement, and after postponed payments.