Salary payment of C Company is made every 15th and 30th of the month through issuances of checks. It pays P6,750,000 per payroll. However, based on the historical clearing of checks issued on salary; 40% will be presented on the day itself; 30% four days from the salary date, 10% 7 days from the salary date and the remaining balance on the tenth day after the salary date. If the interest rate on market is 12% per annum, how much is the incremental income of C Company if the entire amount is not deposited?
Salary payment of C Company is made every 15th and 30th of the month through issuances of checks. It pays P6,750,000 per payroll. However, based on the historical clearing of checks issued on salary; 40% will be presented on the day itself; 30% four days from the salary date, 10% 7 days from the salary date and the remaining balance on the tenth day after the salary date. If the interest rate on market is 12% per annum, how much is the incremental income of C Company if the entire amount is not deposited?
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Salary payment of C
Company is made every 15th
and 30th of the month
through issuances of checks. It pays P6,750,000 per payroll.
However, based on the
historical clearing of checks
issued on salary; 40% will be
presented on the day itself;
30% four days from the salary
date, 10% 7 days from the
salary date and the remaining
balance on the tenth day after
the salary date. If the interest
rate on market is 12% per
annum, how much is the
incremental income of C
Company if the entire amount
is not deposited?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education