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Marla Maple Sugar Company sells to the 12 accounts listed below. Account Average Age of the Account over the Last Year 28 43 10 B
Marla Maple Sugar Company sells to the 12 accounts listed below. Account Average Age of the Account over the Last Year 28 43 10 B Receivable Balance Outstanding $60,000 120,000 70,000 20,000 50,000 220,000 30,000 300,000 40,000 12 10 16 65 33 50 14 35 90,00 210,000 60,000 Trump Financial Corporation will lend 90 percent against account balances that have averaged 30 days or less; 80 percent for account balances between 31 and 40 days; and 70 percent for account balances between 41 and 45 days. Customers that take over 45 days to pay their bills are not considered as adequate accounts for a loan. The current prime rate is 10 percent, and Trump Financial Corporation charges 5 percent over prime to Marla Maple Sugar Company as its annual loan rate. a. Determine the maximum loan for which Marla Maple Sugar Company could qualify. Maximum loan amount $ b. Determine how much one month's interest expense would be on the loan balance determined in part a. Interest expense $
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