Would you as a bank loan officer make the loan

Assignment Help Management Theories

Reference no: EM131367975

The Raattama Corporation had sales of $3.5 million last year, and it earned a 5 percent return, after taxes, on sales. Recently, the company has fallen behind in its accounts payable. Although its terms of purchase are net 30 days, its accounts payable represent 60 days' purchases. The company's treasurer is seeking to increase bank borrowings in order to become current in meeting its trade obligations (that is, to have 30 days' payables outstanding). The company's balance sheet is as follows (thousands of dollars):

437_Figure 3.jpg

a. How much bank financing is needed to eliminate the past-due accounts payable?

b. Would you as a bank loan officer make the loan? Why or why not?

Reference no: EM131367975

Questions Cloud

Define cash discounts and seasonal dating : Define Cash discounts, Seasonal dating, Aging schedule; days sales outstanding (DSO), Payments pattern approach, uncollected balances schedule and Simple interest; discount interest, add-on interest.

Personal success only in terms of financial gain : Employees today are less likely to define their personal success only in terms of financial gain. Many more workers claim that achieving a good work-life blance is a higher priority than "moving up the corporate ladder."

Department is planning to serve the rural communities : A volunteer fire department is planning to serve the rural communities shown in network below. It has just purchased two used fire engine auctioned off by a nearby city. The travel time in minutes between communities in the service area is shown on t..

What is the tri and what are its main drawbacks : Question 1: What is the TRI and what are its main drawbacks? How do you think those drawbacks could be addressed?

Would you as a bank loan officer make the loan : How much bank financing is needed to eliminate the past-due accounts payable?- Would you as a bank loan officer make the loan? Why or why not?

Show the new sm chart and show the state assignments : If the given (original) SM chart is implemented using a traditional ROM method, how big a ROM is needed? Explain your calculation.

What are the strengths and weakness of each approach : Clearly, both internal and external recruiting offer significant benefits and drawbacks, although many students approach this topic with strong, preconceived notions about which is “better.” Explain thoroughly whether you believe internal or external..

How do they use visuals to keep attention : Locate two annual reports on the Internet. A good source is Report Watch. Compare the style of the two reports. Here are some questions to get you started: 1. How do they use visuals to keep attention? 2. What differences do you see in the lett..

Write a proper paper on the song analysis of song : Write a proper paper on the song analysis of song A Thousand Years By Mr Heather

User Account

All Pages