What would be the amount of a bank loan a year from now

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Problem 1: Assume you are currently carrying an accounts receivable balance of $10,000. How might you use accounts receivables to obtain an additional bank loan?

Problem 2: Assume at the end of next year, you will have an accounts receivable balance of $15,000 and an inventories balance of $30,000. If a bank normally lends an amount equal to 80 percent of accounts receivable and 50 percent of inventories pledged as collateral, what would be the amount of a bank loan a year from now? You must show the math (formula) that led to the answer to this question. Showing the answer alone without the formula is not acceptable.

Reference no: EM132970738

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