Effective annual rate of non–free trade credit

Assignment Help Financial Management
Reference no: EM131551487

Lima Corporation makes purchases on credit, and its suppliers grant it credit terms of 2/15, net 30. Assuming there are 360 days in a year, the effective annual rate of non–free trade credit if the firm did not take discounts but did pay on the due date is?

Reference no: EM131551487

Questions Cloud

You would be willing to pay to buy down the interest rate : What are the most points you would be willing to pay to buy down the interest rate?
Does the irr rule agree with the npv? rule : Calculate the IRR. Does the IRR rule agree with the NPV? rule?
What standard determines whether these parties have contract : What standard determines whether these parties have a contract?
Bonds outstanding with six months left to maturity : Badger Corp. has an issue of 6% bonds outstanding with 6 months left to maturity. The bonds are currently priced at $1011, and pay interest semiannually.
Effective annual rate of non–free trade credit : the effective annual rate of non–free trade credit if the firm did not take discounts but did pay on the due date is?
A revolving credit agreement : A revolving credit agreement is:
Best-case npv and the worst-case npv respectively : What are the best-case NPV and the worst-case NPV respectively
What is the effective annual rate of the loan : what is the effective annual rate (EAR) of the loan?
What is the commercial papers effective annual rate : Assuming there are 360 days in a year, what is the commercial paper's effective annual rate (rEAR)?

Reviews

Write a Review

Financial Management Questions & Answers

  Calculate the operating break even point

a) Put together the complete income statement for the organic fertilizer line's first year. Is the line expected to be profitable? b) Calculate the operating break even point in both units and dollars. c) How many applications would Martin need to ..

  What is the firms aftertax cost of debt

Electronic Products has 22,500 bonds outstanding that are currently quoted at 101.6. The bonds mature in 8 years and pay an annual coupon payment of $90. What is the firm's aftertax cost of debt if the applicable tax rate is 34 percent?

  The weights on a portfolio stocks consisting

what are reasonable constraints that a portfolio manager would put on the weights on a portfolio stocks consisting of approximately 20 companies?

  Find the current forward rate

Suppose that the current euro-dollar spot rate is $1.25 and that the euro sells at a 1.5% forward discount. Find the current forward rate.

  Prevailing rates on comparable securities

A 30-year corporate bond sold to investors at par ($1000) with a 10 percent coupon rate is called sixteen years later at a 12 percent call premium. At the time of call, prevailing rates on comparable securities were 8 percent. If the bond's holder re..

  Earn interest at rate per annum compounded quarterly

On January 1, 1998, John deposited $ 1000 into Bank X to earn interest at rate i per annum compounded quarterly. On January 1, 2003, he transferred his account to Bank Y to earn interest at rate j per annum compounded quarterly.

  Investment in one-year zero-coupon bonds

A pension plan is obligated to make disbursements of $1.1 million, if these are the only two assets funding the plan? Investment in one-year zero-coupon bonds

  Explain the concept of internal rate of return

Explain the concept of internal rate of return (IRR) as it is applied to the management of medical projects. Provide a specific example related to your own work or professional interests.

  The bonds make annual payments and have par value

Lycan, Inc., has 7.2 percent coupon bonds on the market that have 10 years left to maturity. The bonds make annual payments and have a par value of $1,000. If the YTM on these bonds is 9.2 percent, what is the current bond price?

  What must be expected growth rate of company dividends

Arts and Crafts, Inc., will pay a dividend of $7 per share in 1 year. It sells at $70 a share, and firms in the same industry provide an expected rate of return of 14%. What must be the expected growth rate of the company’s dividends?

  What is the effective cost of borrowing in case

Your firm has an average collection period of 39 days. Current practice is to factor all receivables immediately at a 2.00 percent discount. What is the effective cost of borrowing in this case?

  The expected rate of return on the market portfolio

You are considering acquring a firm that you believe can generate expected cash flow of $22,000 a year forever. However, you recognize that those cash flows are uncertain. suppose you believe that the beta of the firm is 1.6. How much is the firm wor..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd