User Account

All Pages

Determine the annual financing cost

Assignment Help Finance Basics
Reference no: EM131120202

The Pulaski Company has a line of credit with a bank under which it can borrow funds at an 8 percent interest rate. The company plans to borrow $100,000 and is required by the bank to maintain a 15 percent compensating balance.

Determine the annual financing cost of the loan under each of the following conditions:

a. The company currently maintains $7,000 in its account at the bank that can be used to meet the compensating balance requirement.

b. The company currently has no funds in its account at the bank that can be used to meet the compensating balance requirement.

Reference no: EM131120202

Questions Cloud

Associated with the affordable care act : Research a policy associated with the Affordable Care Act in your home state or another state that may affect healthcare reform and/or the way health care is provided in the chosen state. Describe the policy and who wrote and/or promoted the policy..
Create a survey that examined the frequency of drug : By Week 3, Day 3 respond to the discussion question. Submit your response to the appropriate Discussion Area. Use the same Discussion Area to comment on your classmates' submissions, and continue the discussion until Week 3, Day 7. All written assign..
Differentiate between money and capital markets : Describe the role of the financial institutions and financial markets in our economy
How do think these statements impact culture of organization : Explain how you see the principles expressed in the statements manifested in each company's public reputation, and how they treat their employees in the services they provide, their marketing, etc. Provide a few specific examples to demonstrate yo..
Determine the annual financing cost : The Pulaski Company has a line of credit with a bank under which it can borrow funds at an 8 percent interest rate. The company plans to borrow $100,000 and is required by the bank to maintain a 15 percent compensating balance. Determine the annual f..
Question regarding the exemplification assignment : Illustration /Exemplification Assignment"Everyone is ignorant, only on different subjects." (Will Rogers)
How company differentiates its product from its competition : Positioning is the act of differentiating a brand in consumer minds from its competitors in terms of attributes and benefits. Name a specific product, its target market, and how the company differentiates its product from its competition.
Evaluate the significance of the way megan handled mark''s : Compose a sexual harassment policy for Syntec Corporation that would address harassment issues for all employees. Next, select three (3) elements of this policy that you believe would have the greatest impact at Syntec Corporation. Justify your re..
Effective writing center for assignment : References to your course readings should be included when they are appropriate. You are encouraged to utilize the resources of the effective writing center for this assignment. Information about this process appears under Additional Information.

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the required rate of return on the stock

A stock that currently trades at $10 has a beta of 1.6. The risk-free interest rate for the is 10%, and the market price of risk is expected to be 5%.

  Future value of janet boyle deposit

Use your finding in part a to discuss the effect of more frequent deposits and compounding of interest on the future value of an annuity.

  Computation of effective duration of a bond for change

Computation of effective duration of a bond for change in interest rates and Calculate the effective convexity to a 100 basis point change of the bond

  What is the break-even point in units for the company

The average selling price of its finished product is $180 per unit. The variable cost for these same units is $126 Allison Radios incurs fixed costs of $540,000 per year.

  Write a paper about leaders who demonstrate my strengths

Write a paper about "Leaders Who Demonstrate My Strengths".

  Determine the present value of investment

I own a $1,000 portfolio which is invested in stock A and stock B plus a risk-free asset. $400 is invested in stock A. Stock A has a beta of 1.3 and stock B has a beta of .7,

  Would it matter to you if you were an investor

Would it matter to you if you were an investor? Would it matter to the company?

  What is the company net income

Recreational Supplies Co. has net sales of $10,815,310, an ROE of 21.06 percent, and a total asset turnover of 3.00 times. If the firm has a debt-to-equity ratio of 1.34, what is the company's net income?

  The net cash flows of advantage leasing for the next 3

the net cash flows of advantage leasing for the next 3 years are 42000 49000 and 64000 respectively after which the

  How the fraudsters were caught

Please research three financial crimes and detail each of the following: How the fraudsters were caught

  Discuss the non-rational factors

Discuss the non-rational factors that may have a role in the valuation of stocks and stock market equilibrium. Provide specific examples to support your response.

  Should the spectrometer be purchased

The spectrometer would have no effect on revenues, but it is expected to save the firm $25,000 per year in before tax operating cost, mainly labor. The firm's marginal federal-plus-state tax rate is 40%. If the project's cost of capital is 10%, shoul..

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