User Account

All Pages

What would be the value of the loan

Assignment Help Managerial Accounting
Reference no: EM133016520

Question - A company borrowed $10 million for five years from Atlantic Bank. The company pays Atlantic Bank a fixed annual rate of 8 percent and must pay back the $10 mil- lion loan at the end of the borrowing period. A year has passed since the loan was made and Atlantic Bank wants to sell the loan to Pacific Bank.

a. If the interest rate is now 7 percent, what is the value of the loan?

b. What would be the value of the loan if the company was paying the bank 4 percent every six months instead of 8 percent per year?

Reference no: EM133016520

Questions Cloud

What is the total variable contribution margin : They are considering producing either 30,000 or 40,000 units during the period. What is the TOTAL VARIABLE CONTRIBUTION MARGIN
Firewalls to block employee access to certain websites : Organizations often use firewalls to block employee access to certain websites. Do you agree with this practice, or do you think it violates employee privacy?
Compute the market price of these bonds on November : Compute the market price of these bonds on November 1, 2020 assuming that the prevailing market interest rate at that time is 8%
What is the required rate of return on this stock : If the company's next dividend, which will be paid in a year, is $1.01 and its current stock price is $22.35, what is the required rate of return on this stock
What would be the value of the loan : What would be the value of the loan if the company was paying the bank 4 percent every six months instead of 8 percent per year
What is the yield on a discount basis of a bill : What is the yield on a discount basis of a bill whose face value F is 1,000, price P is 975 and the number of calendar days remaining to maturity is 126
What are the benefits of an S Corporation versus a LLC : What are the benefits of an S Corporation versus a LLC? What happens when an S Corp. is involuntarily converted to a regular corporation
Calculate the costs for both alternatives : This service would be used for all claims and would cost $110 per claim but would reduce the risk of overcharging by 10%. Calculate the costs
How much were cash payments for insurance during the year : Prepaid Insurance was $10,000 at the beginning of the year and $15,000 at the end of the year. How much were cash payments for insurance during the year

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Linear regression analyzing total overhead cost

Multiple regression analysis analyzing total overhead cost along with both units sold and machine hours used

  Difference between absorption costing and variable costing

What is the basic difference between absorption costing and variable costing - What is the company's break-even point in terms of units sold

  What volume level will the annual total cost of each system

What volume level will annual total cost of each system be equal? (Do not round intermediate calculations and round final answer up to nearest whole number.)

  Determine the contribution margin

A company recorded the following items in a year, Sales $10,000, Variable production costs $200, Fixed costs $8,000. Determine the contribution margin

  Prepare fully labeled variance diagrams for direct materials

Prepare fully labeled variance diagrams for Direct Materials and Direct Labour including the specific dollar amounts for all variances

  Which actions would increase return on investment

If budgeted expenses were $100 and actual expenses were $90 there would be? Which actions would increase return on investment

  Why is wise for an organisation to have technology disaster

Why is wise for an organisation to have a Technology Disaster Plan? Broadly, what types of things will it cover and how can you incorporate cloud-based solution

  Question process solutions provides a computer-based

question process solutions provides a computer-based document processing service. the accountant has produced the

  What is the minimum transfer price for plastics division

Plastics Division of Weston Company, Plastics Division is operating at full capacity. What minimum transfer price that the Plastics Division should accept?

  Determine the equivalent units of production for materials

The Finishing Department of Edwards Company. Compute the equivalent units of production for materials and conversion costs for the month of July.

  Determine the accounting entries for the cost

Determine the accounting entries for the cost of output and the cost of the loss if actual output were as follows: 1100 units (so that actual loss is 400 units)

  Why is the break-even point important

Question - Why is the break-even point important and what are the challenges for businesses in calculating and using it

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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