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Vilka [71]
3 years ago
13

Sun Inc. assigns $6,000,000 of its accounts receivables as collateral for a $2 million 8% loan with a bank. Sun Inc. also pays a

finance fee of 1% on the transaction upfront. What would be recorded as a gain (loss) on the transfer of receivables
Business
1 answer:
meriva3 years ago
7 0

Answer:

The answer is: Assigning accounts receivables as collateral for a bank is not a asset transfer.

Explanation:

Even as the bank offers Sun Inc. with a factoring limit, the accounts receivables are still in the firm's accounting book. The firm has the obligations to go after their debtors for collections. The account receivables are transferred to creditors when a company becomes defaulted or bankrupted.

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Inventory records for Dunbar Incorporated revealed the following: Date Transaction Number of Units Unit Cost Apr. 1 Beginning in
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Answer:

$816

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Most businesses replace their computers every two to three years. Assume that a computer costs $2,000 and that it fully deprecia
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Answer:

$2000=Z/(1+i)^1+Z/(1+i)^2+Z/(1+i)^3

Explanation:

let Z be the annual minimum cash flow

The internal rate of approach can be used here, in other words, the rate of return at which capital outlay of $2000 is equal present values of future cash flows

In year 1, present value of cash =X/discount factor

year 1 PV=Z/(1+i)^1

year 2 PV=Z/(1+i)^2

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$2000=Z/(1+i)^1+Z/(1+i)^2+Z/(1+i)^3

Solving for Z above would give the minimum annual cash flow that must be generated for the computer to worth the purchase

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Z can be computed thus:

$2000=Z(1/(1+0.12)^1+(1/(1+0.12)^2+(1+0.12)^3)

$2000=Z*3.09497902

Z=$2000/3.09497902

Z=$646.21

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