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Digital Access Inc. needs $317,050 in funds for a project. (Assume the loan term is one...
Digital Access Inc. needs $250,000 in funds for a project. (Assume the loan term is one year.) a. With a compensating balance requirement of 20 percent, how much will the firm need to borrow? (Do not round intermediate calculations.) Amount to be borrowed b. Given your answer to part a and a stated interest rate of 10 percent on the total amount borrowed, what is the effective rate on the $250,000 actually being used? (Input your answer as a percent...
Digital Access Inc. needs $400,000 in funds for a project. (Assume the loan term is one year.) a. With a compensating balance requirement of 20 percent, how much will the firm need to borrow? Amount to be borrowed $ b. Given your answer to part a and a stated interest rate of 9 percent on the total amount borrowed, what is the effective rate on the $400,000 actually being used? (Input your answer as a percent rounded...
Neveready Flashlights Inc. needs $350,000 to take a cash discount of 3/18, net 72. A banker wil dan the money for 54 days at an interest cost of $14,500 a. What is the effective rate on the bank loan? Use a 360-day year. Do not round Intermediate calculations. Input your answer as a percent rounded to 2 decimal places) Effective rate of interest b. How much would it cost in percentage terms) f the firm did not take the cash...
Harper Engine Company needs $634,000 to take a cash discount of 2.50/20, net 120. A banker will loan the money for 100 days at an interest cost of $14,700. a. What is the effective rate on the bank loan? (Use a 360-day year. Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.) Effective rate of interest b. How much would it cost (in percentage terms) if Harper did not take the cash discount...
Harper Engine Company needs $638,000 to take a cash discount of 1.50/15, net 65. A banker will loan the money for 50 days at an interest cost of $16,800. a. What is the effective rate on the bank loan? (Use a 360-day year. Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.) Effective rate of interest L % b. How much would it cost (in percentage terms) if Harper did not take the...
Neveready Flashlights, Inc. needs $410,000 to take a cash discount of 2/10, net 60. A banker will loan the money for 50 days at an interest cost of $6,600. a. What is the annual rate on the bank loan? (Use 365 days in a year. Do not round intermediate calculations. Round the final answer to 2 decimal places.) Annual rate % b. How much would it cost (in percentage terms) if the firm did not take the cash discount, but...
Neveready Flashlights Inc. needs $340,000 to take a cash discount of 2/10, net 60. A banker will loan the money for 50 days at an interest cost of $5,900. a. What is the annual rate on the bank loan? (Use 365 days in a year. Do not round intermediate calculations. Round the final answer to 2 decimal places.) Annual rate % b. How much would it cost (in percentage terms) if the firm did not take the cash...
Flashlights, Inc needs $500,000 to take a cash discount of 2/10, net 80 A 8 banker wll loan the money for 70 days at an interest cost of $7.500 a What is the annual rate on the bank loan? (Use 365 days in a year. Do not round intermediate celculetions. Round the final answer to 2 decimal places) b. How much would it cost (in percentage terms) if the firm did not take the cash discount, but paid the bill...
In exchange for a $540 million fixed commitment line of credit, your firm has agreed to do the following: 1. Pay 1 percent per quarter on any funds actually borrowed. 2. Maintain a 4 percent compensating balance on any funds actually borrowed. 3. Pay an up-front commitment fee of 13 percent of the amount of the line. Based on this information, answer the following: a. Ignoring the commitment fee, what is the effective annual interest rate on this line of...
In exchange for a $500 million fixed commitment line of credit, your firm has agreed to do the following: 1. Pay 2 percent per quarter on any funds actually borrowed. 2. Maintain a 4 percent compensating balance on any funds actually borrowed. 3. Pay an up-front commitment fee of .2 percent of the amount of the line. Based on this information, answer the following: a. Ignoring the commitment fee, what is the effective annual interest rate on this line of...