Your company's annual material purchases are $$6,000,000($evenly spread out over $365$ days$).$ Currently your accounts payable clerk sends in each payment after $20$ days. However you have determined that payments sent out after $30$ days will stay make it in time to your supplier to meet the $35$ net day payment terms. Your company's annual cost of borrowing is $10\%.$ How much money can you save by sending payments after $30$ days?: $*$

a$.$ $$16,438$

b$.$ $$23,546$

c$.$ $$50,000$

d$.$ $$600,000$

ABC Company has received a request for a credit account with a limit of $$50,000.$ The new customer is expected to purchase $$200,000$ in merchandise each year. ABC's expected gross margin on the merchandise is $25\%.$ ABC also expected to incur variable expenses of $4\%$ of net sales for the sales person's commissions. Assuming a marginal tax rate of $30\%$ how much additional net income does ABC expect to gain from this new customer each year?: $*$

a$.C$$$7,350$

b$.c$$$8,750$

c$.c$$$10,200$

d$.C$$$29,400$

ABC Company has the following income statement. What is the company's interest coverage ratio?: ${?}^{**}$

$\backslash$table$[[$Sales$,$$$,20,000],[$Cost of goods sold,,$10,000],[$Gross profit,$$,10,000],[$SG&A$,,3,000],[$Operating profit,$$,7,000],[$Interest expense,,$2,000],[$Earnings before taxes,$$,5,000],[$Taxes$,,2,000],[$Net income,$$,3,000]]$

a$.1\mathrm{.}5$

b$.2\mathrm{.}5$

c$.3\mathrm{.}5$

d$.5\mathrm{.}0$

$34.$ On April $24,2012$ the US Dollar$/$Canadian spot rate was $$0\mathrm{.}97$ and the US Dollar$/$Euro spot rate was $$1\mathrm{.}35.$ A Canadian company had to pay its German supplier $200,000$ Euros. How many Canadian dollars were required to make the payment on April $11,2012?$: $*$

a$.$ $$148,148$

b$.$ $$261,900$

c$.$ $$278,351$

d$.$ $$286,959$

$35.$ Based on the cash flows below which project has the shortest payback period?

$\backslash$table$[[$Cash flows,Year $0,$Year $1,$Year $2,$Year $3,$Year $4],[$Project A$,$$$(8,000),$$$1,000,$$$1,000,$$$3,000,$$$4,000$