ABC needs $627,000 to take advantage of a special offer from their key supplier. The loan...
ABC needs $627,000 to take advantage of a special offer from their key supplier. The loan will allow them to reduce their accounts payable and begin taking trade discounts. They plan to repay the loan in one year out of their normal operating cash flows. The bank has offered a one-year discountloan at an annual percentage rate of 5.25%. Given this information, how many dollars of interest is ABC expected to pay for this arrangement?
Homework Answers
Answer:
Given
Loan Amount L=$627000
Interest rate r=5.25%
Since loan is discounted one so interest will be deducted at disbursal of loan
So Interest paid in dollars = 627000*5.25%=$32917.5
Add Answer to:
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