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Bas_tet [7]
3 years ago
15

Matt's Machine Company has borrowed $10 million for four months at 5.5% APR, using inventory stored in a field warehouse as coll

ateral. The warehouse fee is 0.5%, payable at the beginning of the loan. What is Matt's EAR?
Business
1 answer:
Mnenie [13.5K]3 years ago
8 0

Answer:

The Matt's EAR is 7.24%

Explanation:

The money borrowed by the company (L) = $10 million

Time period for the loan (T) = 4 months

Rate given (APR) = 5.5%

Per Month rate R=5.5%/12=0.46%

The fee of warehouse that is paid at the starting of the loan = 0.5%

Now we have to calculate the Matt’s EAR.

Warehouse fees =0.5%

So Fees F= 0.5% × L = 0.5% × $10 = $0.05 millions

Therefore, the Net amount we get N = L – F = 10 - 0.5 = $9.95 millions

Assume  r be the per month EAR

N*(1+r)^4 = L*(1+R)^4

9.95*(1+r)^4 = 10*(1+0.46%)^4

r=0.58%

EAR =(1+r)^12-1= (1+0.58%)^12-1 = 7.24%

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Bezzdna [24]

Answer:

Patriots net income for the year = $245,000

Explanation:

Data provided in the question:

Revenue of Patriot Partners during the year = $245,000

Expenses of Patriot Partners during the year = $120,000

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Now,

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3 0
3 years ago
Carla's business recently suffered an attack that shut down operations. What planning document describes how her business should
Kruka [31]

Answer:

A business continuity document

Explanation:

A business continuity plan document helps protect a business from the impact of potential crises that may affect their operations.

It is very important for small businesses to have this written document.

Carla's business continuity plan document should detail:

1. the key business functions needed to get operating as quickly as possible and the resources needed to do so if there's an attack.

2. identify potential crises that might affect the business and also determine how to minimise the risks of these disasters occurring.

Since training has been given to staffs before about their responsibilities in an emergency situation, they should apply what they've learnt.

For example, if there's a possibility for an attack that may affect power supply, Carla should put a back-up generator in place, in the event of a failure.

5 0
2 years ago
During the current year, Brewer Company acquired all of the outstanding common stock of miller Inc. paying $12,000,000 cash. The
Lesechka [4]

Answer:

See the explanation below:

Explanation:

The merged details are first sorted as follows:

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Accounts receivable                     1,800,000                   1,625,000

Inventories                                     2,700,000                  4,000,000

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Accounts payable                          3,000,000                 3,000,000

Bonds payable                               4,500,000                  4,125,000

The calculation will now be done using the fair value as follows:

Total fair value of assets = $1,625,000 + 4,000,000 + 11,625,000 = $17,250,000

Total fair value of liabilities = $3,000,000 + 4,125,000 = $7,125,000

Fair Value of Miller Inc. Equity = $17,250,000 - $7,125,000 = $10,125,000

Goodwill from the acquisition = $12,000,000 - $10,125,000 = $1,875,000

The journal entries will look as follows:

<u>Details                                          Dr ($)                      Cr ($)          </u>

Goodwill                                   1,875,000

Miller Inc. Equity acquired      10,125,000

Cash                                                                         12,000,000

<u>To record the acquisition Miller Inc.                                                 </u>

7 0
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Answer:

False

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It contains what is deemed illegal, values and ethical conducts

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Three factors primarily contribute to shortages: rising demand, falling supply, and government action. The term "scarcity" ought not to be confused with "shortage" as it is used in economics.

Command economies experience higher shortages. Here, the government refuses to let the forces of supply and demand determine the price of a good or service on the open market.

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