CH17FinancingCurrentAssets(财务管理,英文版).pptx
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CH17FinancingCurrentAssets(财务管理,英文版).pptx
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,CHAPTER17FinancingCurrentAssets,WorkingcapitalfinancingpoliciesA/P(tradecredit)CommercialpaperS-Tbankloans,WorkingCapitalFinancingPolicies,Moderate:
Matchthematurityoftheassetswiththematurityofthefinancing.Aggressive:
Useshort-termfinancingtofinancepermanentassets.Conservative:
Usepermanentcapitalforpermanentassetsandtemporaryassets.,Years,$,PermC.A.,FixedAssets,Temp.C.A.,Lowerdashedline,moreaggressive.,S-TLoans,L-TFin:
Stock,Bonds,Spon.C.L.,ModerateFinancingPolicy,ConservativeFinancingPolicy,FixedAssets,Years,$,PermC.A.,L-TFin:
Stock,Bonds,Spon.C.L.,MarketableSecurities,ZeroS-Tdebt,Whatisshort-termcredit,andwhatarethemajorsources?
S-Tcredit:
Anydebtscheduledforrepaymentwithinoneyear.Majorsources:
Accountspayable(tradecredit)BankloansCommercialpaperAccruals,IsS-TcreditriskierthanL-T?
Tocompany,yes.Requiredrepaymentalwayslooms.Mayhavetroublerollingoverloans.Advantagesofshort-termcredit:
Lowcost-visualizeyieldcurve.Cangetfundsrelativelyquickly.Canrepaywithoutpenalty.,Isthereacosttoaccruals?
Dofirmshavemuchcontroloveramountofaccruals?
Accrualsarefreeinthatnoexplicitinterestischarged.Firmshavelittlecontroloverthelevelofaccruals.Levelsareinfluencedmorebyindustrycustom,economicfactors,andtaxlaws.,Whatistradecredit?
Tradecreditiscreditfurnishedbyafirmssuppliers.Tradecreditisoftenthelargestsourceofshort-termcredit,especiallyforsmallfirms.Spontaneous,easytoget,butcostcanbehigh.,B&Bbuys$3,030,303gross,or$3,000,000net,ontermsof1/10,net30,andpaysonDay40.Howmuchfreeandcostlytradecredit,andwhatsthecostofcostlytradecredit?
Netdailypurchases=$3,000,000/360=$8,333.,Gross/NetBreakdown,Companybuysgoodsworth$3,000,000.Thatsthecashprice.Theymustpay$30,303moreiftheydonttakediscounts.Thinkoftheextra$30,303asafinancingcostsimilartotheinterestonaloan.Wanttocomparethatcostwiththecostofabankloan.,Payablesleveliftakediscount:
Payables=$8,333(10)=$83,333.,CreditBreakdown:
Totaltradecredit=$333,333Freetradecredit=83,333Costlytradecredit=$250,000,Payableslevelifdonttakediscount:
Payables=$8,333(40)=$333,333.,NominalCostofCostlyTradeCredit,Butthe$30,303ispaidallduringtheyear,notatyear-end,soEARrateishigher.,Firmloses0.01($3,030,303)=$30,303ofdiscountstoobtain$250,000inextratradecredit,so,NominalCostFormula,1/10,net40,Pays1.01%12timesperyear.,EffectiveAnnualRate,1/10,net40,Periodicrate=0.01/0.99=1.01%.Periods/year=360/(4010)=12.EAR=(1+Periodicrate)n1.0=(1.0101)121.0=12.82%.,CommercialPaper(CP),Shorttermnotesissuedbylarge,strongcompanies.B&BcouldntissueCP-itstoosmall.CPtradesinthemarketatratesjustaboveT-billrate.CPisboughtwithsurpluscashbybanksandothercompanies,thenheldasamarketablesecurityforliquiditypurposes.,AbankiswillingtolendB&B$100,000for1yearatan8percentnominalrate.WhatistheEARunderthefollowingfiveloans?
1.Simpleannualinterest,1year.2.Simpleinterest,paidmonthly.3.Discountinterest.4.Discountinterestwith10percentcompensatingbalance.5.Installmentloan,add-on,12months.,WhymustweuseEARtoevaluatethealternativeloans?
Nominal(quoted)rate=8%inallcases.Wewanttocompareloancostratesandchooselowestcostloan.WemustmakecomparisononEAR=Equivalent(orEffective)AnnualRatebasis.,SimpleAnnualInterest,1-YearLoan,“Simpleinterest”meansnotdiscountoradd-on.Interest=0.08($100,000)=$8,000.,Onasimpleinterestloanofoneyear,kNom=EAR.,SimpleInterest,PaidMonthly,Monthlyinterest=(.08/12)(100,000)=$666.67.,-100,000.00,-666.67,100,000,0,1,12,-666.67,(More),.,INPUTS,OUTPUT,12100000-666.67-100000NI/YRPVPMTFV0.6667,kNom=(Monthlyrate)(12)=0.66667(12)=8.00%.,or:
8NOM%,12P/YR,EFF%=8.30%.,Note:
Ifinterestwerepaidquarterly,then:
Daily,EAR=8.33%.,Interestdeductible=0.08($100,000)=$8,000.Usablefunds=$100,000$8,000=$92,000.,8%DiscountInterest,1Year,0,1,i=?
92,000,-100,000,1,92,0,-100,8.6957%=EAR,N,PV,I/YR,PMT,FV,INPUTS,OUTPUT,DiscountInterest(Continued),Amt.borrowed,=$108,696.,Amountneeded1-Nominalrate(decimal),$100,0000.92,Need$100,000.Offeredloanwithtermsof8%discountinterest,10%compensatingbalance.,(More.),Amountborrowed=$121,951.,Amountneeded1-Nominalrate-CB,$100,0001-0.08-0.1,Interest=0.08($121,951)=$9,756.,EARcorrectonlyifborrowfor1year.,(More.),Thisprocedurecanhandlevariations.,N,I/YR,PV,PMT,FV,1,100000,-109756,9.756%=EAR,0,0,1,i=?
121,951Loan,-121,951+12,195-109,756,-9,756Prepaidinterest,-12,195CB,100,000Usablefunds,8%DiscountInterestwith10%CompensatingBalance(Continued),INPUTS,OUTPUT,1-YearInstallmentLoan,8%“Add-On”,Interest=0.08($100,000)=$8,000.Faceamount=$100,000+$8,000=$108,000.Monthlypayment=$108,000/12=$9,000.=$100,000/2=$50,000.Approximatecost=$8,000/$50,000=16.0%.,Averageloanoutstanding,(More.),InstallmentLoan,TofindtheEAR,recognizethatthefirmhasreceived$100,000andmustmakemonthlypaymentsof$9,000.Thisconstitutesanordinaryannuityasshownbelow:
-9,000,100,000,0,1,12,i=?
-9,000,-9,000,Months,2,.,12,100000,-9000,1.2043%=ratepermonth,0,kNom=APR=(1.2043)(12)=14.45%.EAR=(1.012043)12-1=15.45%.,14.45NOMentersnomrate12P/YRenters12pmts/yrEFF%=15.4489=15.45%.,1P/YRtoresetcalculator.,N,PV,I/YR,FV,PMT,INPUTS,OUTPUT,Whatisasecuredloan?
Inasecuredloan,theborrowerpledgesassetsascollateralfortheloan.Forshort-termloans,themostcommonlypledgedassetsarereceivablesandinventories.Securitiesaregreatcollateral,butgenerallynotavailable.,Whatarethedifferencesbetweenpledgingandfactoringreceivables?
Ifreceivablesarepledged,thelenderhasrecourseagainstboththeoriginalbuyerofthegoodsandtheborrower.Whenreceivablesarefactored,theyaregenerallysold,andthebuyer(lender)hasnorecoursetotheborrower.,Whatarethreeformsofinventoryfinancing?
Blanketlien.Trustreceipt.Warehousereceipt.Theformuseddependsonthetypeofinventoryandsituationathand.,Legalstuffisvital.,Securityagreement:
StandardformunderUniformCommercialCode.Describeswhenlendercanclaimcollateral.UCCForm-1:
FiledwithSecretaryofStatetoestablishclaim.Futurelendersdosearch,wontlendifpriorUCC-1isonfile.,
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