Short-term and long-term liabilities, Operation Management

Assignment Help:

In addition to the car lease, Leonard and Rose each have a VISA card with an interest rate of 18.25% p.a. They currently have a balance of $1,205 and made payments of $3,537 in 2010. You suggest that they pay this off as soon as possible in order to avoid the high interest charges. Although Leonard and Rose could take out a bank loan to save interest, they are nervous that, with a zero balance on their credit card, they might run it up again. You advise them that, in this case, they should  just keep plugging away and pay off the balance as fast as possible. Rose and Leonard think they could reasonably pay it all off in 2011. They will then have this money to contribute to either non-registered savings or RESPs for their children.

Rose and Leonard bought their house at the end of March 2002, making their first bi-weekly mortgage payment in April, 2002 (making 20 payments the first year). The house cost $280,000 and they put 25% down. The interest rate has always been 6.5%. They renewed for a 5-year term  in March 2007. The mortgage has been amortized over 25 years and they make end-of-period mortgage payments. The couple expects to pay off their mortgage in full before they retire. They have joint creditor life insurance on their mortgage, which is $525 p.a.


Related Discussions:- Short-term and long-term liabilities

Explain the liability of each party, Upon graduation from college, Bob, Car...

Upon graduation from college, Bob, Carol, Ted, and Alice formed Kotaku, LP, a limited partnership, to distribute video gaming software over the Internet. Bob and Carol each contrib

What the manager of a regional warehouse must decide, The manager of a regi...

The manager of a regional warehouse must decide on the number of loading docks to request for a new facility in order to minimize the sum of dock costs and driver-truck costs. The

Explain what is the probability that you will make money, The owner of Fire...

The owner of Firewood-2-Go is considering buying a hydraulic wood splitter which sells for $50000. He figures it will cost an additional $80 per cord to purchase and split wood wit

Explain environment that best serves the organization, Briargrove is taking...

Briargrove is taking proposals for a Centralized Learning Network to be rolled out first in the corporate office in Dallas, TX and then across the organizational footprint. A priva

After working for 30 years, After working for 30 years, Ramjee Somjee Dutt ...

After working for 30 years, Ramjee Somjee Dutt opted for VRS and started a courier company and did very well in the first four years. He was now looking for expansion of his busine

Explain what is the first goal of national unions, What is the first goal o...

What is the first goal of national unions? Elections in units where employees are not currently represented are called? Corporate goal achievement is facilitated or inhibited

Explain technology meets the requisite market potential, Pharma Blitz devel...

Pharma Blitz develops and markets new technological products to be used in health care. The development of a new product operates as follows. When a new technology meets the requis

Define what can we learned about business and ethics, Details what can we l...

Details what can we learned about business, ethics, and society.

Factors for plant location choice - suitability of climate, Factors for pla...

Factors for plant Location choice - Suitability of Climate The climate has its own importance in the location of a plant because of two reasons. First there are certain indust

Concept of a productivity boundary and operating efficiency, 1. Porter (199...

1. Porter (1996) attempts to resolve the issue of Skinner's quandary with trade-offs by introducing the concept of a productivity boundary and operating efficiencies. Explain where

Write Your Message!

Captcha
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