Scotiabank approved a $280,000.00 line of credit for Buhler Industries at prime + 0.75%. It requires only the repayment of accrued interest on the 28th of each month, which is automatically deducted from the checking account of Buhler Industries. Buhler took out an advance on December 15 for $240,000.00 and made a payment of $200,000.00 on January 18. The prime rate was 6.25% initially and increased to 7.25% on January 7. Complete the repayment schedule below by filling in the payment and principal amounts. Date Balance before Transaction Annual Interest Rate Number Interest Accrued of Days Charged Interest Payment (+) or Advance Principal Balance afte Amount Transaction (-)

Scotiabank approved a $280,000.00 line of credit for Buhler Industries at prime + 0.75%. It requires only the repayment of accrued interest on the 28th of each month, which is automatically deducted from the checking account of Buhler Industries. Buhler took out an advance on December 15 for $240,000.00 and made a payment of $200,000.00 on January 18. The prime rate was 6.25% initially and increased to 7.25% on January 7. Complete the repayment schedule below by filling in the payment and principal amounts. Date Balance before Transaction Annual Interest Rate Number Interest Accrued of Days Charged Interest Payment (+) or Advance Principal Balance afte Amount Transaction (-)

Name: Scotiabank approved a $280,000.00 line of credit for Buhler Industrie
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Description: Scotiabank approved a $280,000.00 line of credit for Buhler Industries at prime +0.75%. It requires only the repayment of accrued interest on the 28th of each month,which is automatically deducted from the checking account of Buhler Industries. Buhl

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

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Colson Company has a line of credit with Federal Bank. Colson can borrow up to $407,000 at any time over the course of the Year 1 calendar year. The following table shows the prime rate expressed as an annual percentage, along with the amounts borrowed and repaid during the first four months of Year 1. Colson agreed to pay Interest at an annual rate equal to 2.00 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Colson pays 6.25 percent (4.25 percent - 2.00 percent) annual Interest on $83,300 for the month of January. Month January February Month January February March April March April Required: a. Compute the amount of Interest that Colson will pay on the line of credit for the first four months of Year 1. Note: Do not round intermediate calculations. Round your final answers to the nearest whole…
Linstrum Company received a 60-day, 9% note for $56,000, dated July 23, from a customer on account. Required: a. Determine the due date of the note. b. Determine the maturity value of the note. Assume 360 days in a year. c. Journalize the entry to record the receipt of the payment of the note at maturity. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. CHART OF ACCOUNTS Linstrum Company General Ledger ASSETS 110 Cash 111 Petty Cash 120 Accounts Receivable 129 Allowance for Doubtful Accounts 132 Notes Receivable 141 Merchandise Inventory 145 Office Supplies 146 Store Supplies 151 Prepaid Insurance 181 Land 191 Store Equipment 192 Accumulated Depreciation-Store Equipment 193 Office…
Exotic Furnishings Ltd. has a line of credit secured by the equity in the business. The limit on the line of credit is $45,000. Exotic owed $25,935.08 on its line of credit on May 1. The line of credit agreement requires a regular payment of $300.00 on the principal plus interest (including overdraft interest) by electronic transfer after closing on the last day of each month. Overdraft interest is 16% p.a. The line of credit interest is variable. It was 4.7% on May 1, 5.5% effective July 15, and 6.60% effective October 10.. (a) Calculate the interest payments on May 31, June 30, July 31, August 31, September 30, and October 31. (b) What is the account balance on October 31? Click the icon to view the transactions for the period May 1 to October 31. (a) The amount of interest charged on May 31 is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
Vertical Adventures has an open line of credit with a zero balance at its credit union using a fixed interest rate of 7.25%. On the last day of every month, the accrued interest must be paid. On July 8 and August 14, the company made advances of $11,250.00 and $12,750.00, respectively. On July 30, it made a payment of $7,250.00. Vertical Adventures will restore its zero balance on August 31. Construct a full repayment schedule from July 8 to August 31. ( Round all monetary values to the nearest penny.) (Use a minus sign before the dollar sign to denote a negative monetary value. For example, "$$149.63) (Give all "Number of Days" quantities as fractions with denominator 365.) \table[[Date ,\table[[Balance], [before], [Transaction]], \table[[Annual], [Interest] [Rate]],\table[[Number], [of Days]]\table[[Interest],[ Charged]]\table[[Accrued], [Interest]], \table[[Payment], [(+) or], [Advance], [(-) Vertical Adventures has an open line of credit with a zero balance at its credit union…
Exotic Furnishings Ltd. has a line of credit secured by the equity in the business. The limit on the line of credit is $45,000. Exotic owed $25,495.29 on its line of credit on July 1. The line of credit agreement requires a regular payment of $300.00 on the principal plus interest (including overdraft interest) by electronic transfer after closing on the last day of each month. Overdraft interest is 18% p.a. The line of credit interest is variable. It was 6.8% on July 1, 7.95% effective September 10, and 8.60% effective December 14. (a) Calculate the interest payments on July 31, August 31, September 30, October 31, November 30, and December 31. (b) What is the account balance on December 31? Click the icon to view the transactions for the period July 1 to December 31. (a) The amount of interest charged on July 31 is $ (Round the final answer to the nearest cent as needed. Round all intermediate values to six decimal places as needed.)
Singer Company has a line of credit with United Bank. Singer can borrow up to $400,000 at any time over the course of the Year 1 calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during the first three months of Year 1. Singer agreed to pay interest at an annual rate equal to 2 percent above the bank’s prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Singer pays 6.5 percent (4.5 percent + 2 percent) annual interest on $140,000 for the month of February. Month Amount Borrowed or (Repaid) Prime Rate for the Month January $80,000 4.0% February 60,000 4.5 March (20,000) 4.0 Required Provide all journal entries pertaining to Singer’s line of credit for the first three months of Year 1.
JAB Consulting received a promissory note of $18,500 at 8% simple interest for 15 months from one of its customers. After 6 months, Grove Isle Bank discounted the note at a discount rate of 5% Calculate the proceeds that JAB Consulting will receive from the discounted note. Step 1 When a promissory note is sold before maturity, it is said to be discounted. The maturity value represents the total amount of money a promissory note will be worth after interest has accrued. The maturity value is calculated as follows where the rate is expressed as a decimal and the time is a fraction whose numerator is the given amount of time in months and denominator is 12 months. maturity value = principal(1 + rate ✕ time) The rate was given to be 8%. As a decimal, we have 8% = . Find the maturity value (in $) for the promissory note of $18,500 at 8% interest for 15 months. maturity value = principal(1 + rate ✕ time) = 18,500 1 + ✕ 15 12 = $
An automotive dealer borrowed $8200.00 from the Bank of Montreal on a demand note on May 8. Interest on the loan, calculated on the daily balance, is charged to the dealer's current account on the 8th of each month. The automotive dealer made a payment of $2300 on July 12, a payment of $3900 on October 1, and repaid the balance on December 1. The rate of interest on the loan on May 8 was 8% per annum. The rate was changed to 8.6% on August 1 and to 8.95% on October 1. What was the total interest cost for the loan?
Colson Company has a line of credit with Federal Bank. Colson can borrow up to $436,000 at any time over the course of the calendar year. The following table shows the prime rate expressed as an annual percentage along with the amounts borrowed and repaid during the first four months of the year. Colson agreed to pay interest at an annual rate equal to 2.00 percent above the bank's prime rate. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. For example, Colson pays 6.25 percent (4.25 percent +2.00 percent) annual interest on $77,700 for the month of January. Amount Borrowed Prime Rate for the Month Month January February March April or (Repaid) $ 77,700 4.25% 120,700 (16,500) 28,400 3.25 3.75 4.25 Required a. Compute the amount of interest that Colson will pay on the line of credit for the first four months of the year. b. Compute the amount of…
Loans Scotiabank approved a $230.000.00 line of credit for Buhler Industries at prime + 1%. It requires only the repayment of accrued interest on the 24th of each month which is automatically deducted from the checking account of Buhler Industries. Buhler took out an advance on December 6 for $160,000.00 and made a payment of $130,000.00 on January 16 The prime rate was 5.25% initially and increased to 6.5% on January 7. Complete the repayment schedule below by filling in the payment and principal amounts. Payment Date Balance Annual before Interest Transaction Rate Number of Days Interest Accrued Charged Interest (+) or Principal Balance after Advance Amount Transaction (-) Dec 6 $160,000.00 Dec 24 $160.000,00 $160,000.00 Jan 7 Jan 16 $160,000.00 $30,000.00 Jan 24 6.25% 18/365 7.5% 8/365 6.25% 14/365 $383.56 7.5% 9/365 $295.89 $679.45 $49.32 $728.77 $493.15 $493.15 $383.56 $160,000.00 $160,000.00 $30,000.00 $30,000.00 Notes You con can partial credit on this problem
On April 12, Hong Company agrees to accept a 60-day, 8%, $7,800 note from Indigo Company to extend the due date on an overdue account. What is the journal entry that Indigo Company would make when it records payment of the note on the maturity date? (Use 360 days a year.)
On January 26, Vibrant Co. borrowed cash from Conrad Bank by issuing a 30- day note with a face amount of $74,400. Assume a 360-day year. a. Determine the proceeds of the note, assuming the note carries an interest rate of 5%.

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