Evaluating proposals from two different factors

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Reference no: EM131061960

Michael"s Computers is evaluating proposals from two different factors that will provide receivables financing. Big Fee Factoring will finance the receivables at an APR of 8 percent, discounted, and charges a fee of 4 percent. High Rate Factoring offers an APR of 14 percent (nondiscounted) with fees of 2 percent. The average term of either loan is expected to be 35 days. With an average receivables balance of $250,000, which proposal should Michael"s accept?

Reference no: EM131061960

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