Calculate the present value savings associated with paying

Assignment Help Financial Management

Reference no: EM131303917

Calculate the present value savings associated with paying on the last day of the discount trade credit period, as compared to the last day of the net trade credit period. Assume a $40,000 purchase is made from a supplier that offers trade credit terms of 2/10 net 30. Also, assume a discount rate of 5%.

a. -$689.91

b. $39,146.37

c. $39,836.29

d. $689.91

Reference no: EM131303917

Questions Cloud

How much do you have to pay each month : Suppose by the time you graduate your student loan will accumulate to the national average of $37,000 as mentioned in one of the articles. If you plan to pay back the loan in 5 years with equal monthly payment and assume the interest rate is 6% compo..

What will be the price of these bonds : Northrop Real Estate Company management is planning to fund a development project by issuing 10-year zero coupon bonds with a face value of $1,000. Assuming semiannual compounding, what will be the price of these bonds if the appropriate discount rat..

What annual rate of return would be required to permit : Suppose your rich uncle gave you $50,000, which you plan to use for graduate school. You will make the investment now, and you will make 4 annual end-of-year withdrawals of $16,500, beginning 1 year from today. There will be no funds remaining in the..

The profit margin percentages of firm : Use the information in this table (TABLE 1) for the following questions: Table 1 Firm X Y Assets $1.2 million $1.7 million Debt $600,000 $1.3 million Sales $3.5 million $3.5 million Earnings $277,000 $377,000. Utilizing the information above, the Pro..

Calculate the present value savings associated with paying : Calculate the present value savings associated with paying on the last day of the discount trade credit period, as compared to the last day of the net trade credit period. Assume a $40,000 purchase is made from a supplier that offers trade credit ter..

Profits in world with normal or inverted yield curve : It is a fact that the federal government (1) encouraged the development of the savings and loan industry, (2) virtually forced the industry to make long-term fixed-interest-rate mortgages, and (3) forced the savings and loans to obtain most of their ..

Define a database and a database management system : Define a database and a database management system? Describe how they solve the problems of record management?

Corporation is considering the acquisition : N Corporation is considering the acquisition of A Corporation. A Corporation has earnings before interest and tax of $1.75 million, and asset replacement cost approximately equals depreciation. Assuming a 20 percent tax rate and a 10 percent required..

The interest rate does not change with the cost of living : Shaylea, age 22, just started working full-time and plans to deposit $5,000 annually into an IRA earning 88 percent interest compounded annually. Deposits will be made at the end of each year. How much would she have in 20 years, 30 years, and 40 yea..

User Account

All Pages