What is the effective annual interest rate on the factoring

Assignment Help Financial Accounting
Reference no: EM132600576

Question 1: A firm has $800,000 in receivables which it sells to a factor at a 2% discount. The average collection period is one month. What is the effective annual interest rate on the factoring arrangement?

Option 1: 24.00%

Option 2: 24.49%

Option 3: 26.82%

Option 4: 27.44%

Reference no: EM132600576

Questions Cloud

What unleveraged discount rate will used to value pulpless : The risk-free rate is 0.05% and the market risk premium is 0.02%. What unleveraged discount rate will be used to value pulpless
What is the expected yield on the market portfolio : Treasury bills are currently yielding 4%. A stock with a Beta of 0.8 is expected to yield 10%. What is the expected yield on the market portfolio?
Health care impacting organizational change : What are some current trends in health care impacting organizational change? What do you see happening with these trends in the future?
Labour force participation rates : The central bank of Rosewater targets inflation by following the Taylor rule. For each of the following scenarios, explain
What is the effective annual interest rate on the factoring : A firm has $800,000 in receivables, The average collection period is one month. What is the effective annual interest rate on the factoring arrangement?
State of equilibrium before september 11 : Now suppose that the economy was in state of equilibrium before September 11, 2001:
How do program the capital budgeting : How do they explain, evaluate and critique its planning cycle in respect to Operational budgeting. How do they Program their capital budgeting
Historical inflation rates and money growth data : Review and compare the trends in money supplies/ aggregates to the trend in the CPI over several decades.
What types of smart devices : What types of smart devices are they and how can they be used for the benefits of consumers. Include both the advantages and disadvantages of it.

Reviews

Write a Review

Financial Accounting Questions & Answers

  Determine corrections of a statement of financial position

Determine a corrected classified statement of financial position as of July 31, 2019, from the available information, adjusting the account balances

  Sales return request

On December 20th WSS received sales return request in the mail from EWU. The request was approved and the acknowledgement copy mailed to EWU.

  Complete the analysis

Eric's Electronics is moving into new facilities and must determine whether it should retain or replace various fixed assets. Complete the analysis of each of the following transactions.

  Prepare the journal entry moonshine will record on the day

MoonShine Company signed a note for $85,000 to purchase a new piece of equipment. MoonShine will pay the $85,000 back at the end of two years along with any accrued interest. The annual interest rate on the loan is 6%.1. Compute the present value of ..

  What common internal control weaknesses contributed to fraud

What common internal control weaknesses contributed to this fraud?

  An investment project provides cash inflows

An investment project provides cash inflows of $570 per year for eight years. What is the project payback period if the initial cost is $1,675?

  Prepare an income statement for padre travel service

Prepare an income statement for the current year ended June 30, 2010 and prepare a retained earnings statement for the current year ended June 30, 2010.

  Year-end account balances of sales revenue

Side Kicks has year-end account balances of Sales Revenue $834,710; Interest Revenue $18,600; Cost of Goods Sold $583,930; Administrative Expenses $186,150; Income Tax Expense $32,990; and Dividends $18,615. Prepare the year-end closing entries.

  Deciding where to produce cma adapted the domestic engines

deciding where to produce cma adapted the domestic engines co. produces the same power generators in two illinois

  Would the proposed increase in the minimum wage raise

If the demand of unskilled labor were inelastic, would the proposed increase in the minimum wage raise or lower total wage payments to unskilled workers? Would your answer changeif the demand for unskilled labor were elastic?

  What type of strategy do you believe abc is pursuing

Based on this information, do you believe ABC's increase in operating income in 2014 is consistent with the strategy you identified in part a

  What is window basis in the machinery

Natale transfers to Window Corporation depreciable machinery originally costing $ 23,000 and now having a(n) $ 18,000 adjusted basis. In exchange, Natale receives all 75 shares of Window stock having a(n) $ 22,000 FMV and a three-year Window note hav..

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