Compute the annual financing cost of a loan

Assignment Help Financial Management

Reference no: EM13927113

The Odessa Supply Company is considering obtaining a loan from a sales finance company secured by inventories under a field warehousing arrangement. Odessa would be permitted to borrow up to $300,000 under such an arrangement at an annual interest rate of 10 percent. The additional cost of maintaining a field ware-house is $16,000 per year. Determine the annual financing cost of a loan under this arrangement if Odessa borrows the following amounts:

a. $300,000

b. $250,000

Reference no: EM13927113

Questions Cloud

Values between acceptance and rejection of this hypothesis : Given a sample size of 36, with sample mean 670.3 and sample standard deviation 114.9, we perform the following hypothesis test.Null Hypothesis

Statistical consultant confronts ethical issues article : Read the Reflection Before Action: The Statistical Consultant Confronts Ethical Issues article. Read the article A Christian View of the Foundations of Statistics article.

What is the expected number of cpa financial advisors : According to Cerulli Associates of Boston, 30% of all CPA financial advisors have an average client size between $500,000 and $1 million. Thirty-four percent have an average client size between $1 million and $5 million - What is the expected numb..

What is conflict management : What is conflict management? What causes conflicts in the work environment? What managerial actions can be taken to reduce conflict? How can individuals successfully manage conflicts internally

Compute the annual financing cost of a loan : Determine the annual financing cost of a loan under this arrangement if Odessa borrows the following amounts $300,000 and $250,000.

Headquarters of a multinational corporation : You work in the human resource department at the headquarters of a multinational corporation. Your computer is about ti send a number of managers overseas as expatriates (or expats) to France and New Zealand.

Flexible currency trading market in the world : The OTC Market has gradually evolved into the largest, fastest and most flexible currency trading market in the world.

The organization internal and customer data : ESL Inc. is a large company that has been using a series of spreadsheets, access databases, and manual records to keep track of the majority of the organization's internal and customer data.

Help of the systems theory : Select a system topic you are going to use throughout this course. In a paper, analyze your chosen system with the help of the systems theory in the following ways:

User Account

All Pages