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goldfiish [28.3K]
2 years ago
12

A firm buys on terms of 3/15, net 45. It does not take the discount, and it generally pays after 85 days. What is the nominal an

nual percentage cost of its non-free trade credit, based on a 365-day year? The firm's APR of not taking the trade credit is ____. (If you use percent, then do not use the percent sign. Go two places to the right of the decimal point (XX.XX). If you use decimal places, then go four places to the right of the decimal place. 0.XXXX). 0.1613
Business
1 answer:
Firdavs [7]2 years ago
7 0

Answer:

What is the nominal annual percentage cost of its non-free trade credit, based on a 365-day year? The firm's APR of not taking the trade credit is <u>0.1613</u>.

Explanation:

The nominal cost of its non-free trade credit = the discounts lost for paying late.

In this case, the seller offers a 3% discount if the firm pays within 15 days.

annual financial cost = [discount / (100% - discount)] x [365 / (repayment time - discount period)]

annual financial cost = [3% / (100% - 3%)] x [365 / (85 - 15)] = (3% / 97%) x (365 / 70) = 0.1613 or 16.13%

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Fees in 1st year Suppose Adrian and Clemens each Invest $10,000. Adrian Invests in an actively managed mutual fund that has an a
alekssr [168]

Answer:

Task 1:

The answer is $700.

Task 2:

The answer is $130.

Task 3:

The answer is $20.

Task 4:

The answer is $10,570.

Task 5:

The answer is $110.

Explanation:

<h2>Task 1:</h2><h3>How much does each investor make on his investment with the 7% rate of return?</h3><h3>Solution:</h3>

Adrian & Clemens makes [$10,000*0.07] on their investment = $700.

<h2>Task 2:</h2><h3>How much does Adrian pay in fees for his actively managed mutual fund?</h3><h3>Solution:</h3>

Adrian owes to his broker = (10000*.013) = $130

<h2>Task 3:</h2><h3>How much does Clemens pay in fees for the index fund?</h3><h3>Solution:</h3>

Clemens owes to his broker= ($10000*.002) = $20

<h2>Task 4:</h2><h3>At the end of the year, what's the total value (AFTER FEES) of Adrian's mutual fund?</h3><h3>Solution:</h3>

Value of Adrian's stock = $10000+$570 (net of brokerage) = $10,570

<h2>Task 5:</h2><h3>What's the total value (AFTER FEES) of Clemens's index fund?</h3><h3>Solution:</h3>

Value of clemens' stock = $10000+$680 (net of brokerage) = $10,680

<h2>Task 6:</h2><h3>How much more value does Clemens' investment generate than Adrian's in one year's time?</h3><h3>Solution:</h3>

Clemens investment makes ($680-$570) than adrian's investment = $110

4 0
2 years ago
The theory of mercantilism states that a country’s power depends mainly on its wealth. During the Age of Exploration, this meant
aleksklad [387]

Answer:

A positive balance of trade

Explanation:

The theory of mercantilism states that a country’s power depends mainly on its wealth. During the Age of Exploration, this meant that the prosperity of a nation should depend on a large supply of bullion (silver and gold) and a positive balance of trade. A positive balance of trade implies that exports should exceed imports. There were tariffs on imports. This discouraged importation.

Mercantilism was commonly practised in Europe within the 16th to 18th century.

I hope my answer helps you

4 0
3 years ago
Roadway Corporation produces a special line of plastic toy racing cars. Roadway Corporation , produces the cars in batches. To m
r-ruslan [8.4K]

Answer:

the efficiency variance for variable overhead setup costs is $4,810 favorable

Explanation:

The computation of the efficiency variance for variable overhead setup costs is shown below;

= ((15,700 ÷ 265) × 4.25) × $45 - ((15,700 ÷ 325) × 3) × $45

= $11,330.6604 - $6,521.5384

= $4,809.12 favorable

= $4,810 favorable

hence, the efficiency variance for variable overhead setup costs is $4,810 favorable

4 0
2 years ago
Which of the statement(s) is correct? i. Corporations rarely pay tax on the interest income. ii. Higher tax bracket people tend
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Answer:

E. All the statements are correct

Explanation:

i. Corporations rarely pay tax on the interest income.

This statement is correct. Some companies do not even pay any income taxes.

ii. Higher tax bracket people tend to buy municipal bond because it is federal tax exempt.

Correct, people who have high incomes, and are subject to a high federal income tax rate often buy municipal bonds because these bonds are exempt from federal income tax.

iii. Short term capital gain and long-term capital gain are treated differently for individuals.

Correct. Short-term capital gains are those obtained from the sale of property that was owned for less than one year. This gains are often treated with the highest tax rate.

Long-term capital gains are those obtained from the sale of property that was owned for more than one year, and are treated with more favorable tax rates.

iv. The corporate tax rates in the U.S. is one of the lowest among the developed nations.

This statement is correct. The corporate tax rate in the U.S. is a nominal 21% (the effective rate can be as low as 0% for some companies). This is one of the lowest rates among developed nations, whose rates hover around 25 to 30% on average.

5 0
2 years ago
A farmer sells a bushel of corn to the supermarket for $12. The supermarket then sells the corn to customers for $25. What is th
allsm [11]

Answer:

$ 25

Explanation:

As per the description, the exact amount that is being contributed from the corn bushel to the Gross Domestic Product would be $ 25. The price at which the farmer sold it to the supermarket would not be included in the GDP because it would be considered as an intermediary good because the good purchased for the resale purpose is not included in GDP as it leads to double-counting. Thus, <u>only the price of the final good i.e. $ 25 would be included in GDP as it will now be used for final consumption by the customers</u>.

6 0
3 years ago
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