Calculating Cost of Capital and Effective Interest Rates

1.) Delta bonds issued 300,000 in 90 days and 18% but only needs the funds for 70 days over can invest in vn that pays 17% for which it must pay 1.5% commission on what is chasing the cost of bonds for the company?
300,000 * 0.18 = 54,000
54,000 * (90/360) = 13,500

300,000 * 0.17 = 51,000
51,000 * 0,015 = 4,500

13.500-2.833 = 10,667 +4,500 = 15,167 costs

2.) Bank x gives us a loan at 20% payable within 1 year while the bank and we paid the same amount to 19% payable in advance which of the 2 banks charge us the lower effective tax rate?

20/100 = 0.2 = 20% nominal rate = 20% effective rate
19/100 = 0.19 = 19% nominal rate effective rate = 19 / (100-19) = 0.23 = 23%

3.) Effective rate for a loan of 600,000 to be paid within 1 year with a nominal interest rate with a 19% compensating balance of 15% effective rate "calculated?

600,000 * 0.19/600.000- (600,000 * 0.15) = 114.000/510.000 = 0.22 = 22% effective rate
114,000 / (510.000-114.000) = 0.29 = 29%

4.) Delta sold each quarter, 500,000 in bonds to 13% Each issue carries a cost drop of 1,000 pesos. What is the percentage cost of corporate bonds?

500,000 * 0.13 = 65,000
6 * 1,000 = 6,000
6000 65 000 71 000 Total cost =

71.000/500.000 = 0.14 = 14%

Opportunity cost:

5.) What is the opportunity cost of not taking advantage of a discount when conditions are 2 / 20 to 45 days.

45-20 = 25 2 / (100-2) * 360/25 = 720/2.450 = 0.29 = 29%

6.) EDelta provides that during October. 2010, 500,000 in cash needed to buy merchandise. There are 3 ways to finance:
a) opening an annual credit line 500.00 the bank requires a commitment fee of 1% and 18% interest on borrowed funds that the company needs for 30 days.

b) allow some discounts offered in a purchase of 500,000 with conditions 1 / 10 to 40 days.

c) issue 500,000 pesos in bonds at 30 days and 17%

a) 500,000 * 0.18 = 90,000
500,000 * 0.01 = 5,000

90.000/12 = 7.500
(500,000 * 0.01 * 11) / 12 = 4,583 +7,500 = 12,083

b) 1 / (10-1) * 360/30 = 360/2.970 = 0.12 = 12%

500,000 * 0.12 = 60,000
60,000 * 0.12 = 5,000

c) 17 --- 360
X ---- 30 17 * 30 = 510/360 = 1,416%
500,000 * 1 416% = 7,080