Week 5 individual assignment #2 - Essay Example

I is the interest rate per year divided by 12 and P is the rpicncipal amount. After calculation the amount paid per month amount to 709.9866, we therefore sumarise the two month amortization period as follows: Secured short term credit is a form of borrowing whereby an individual has to pledge an asset to secure the loan and if the amount is not paid bvack then the asset can be sold in order to recover the debt owned. For the unsecured short term credit the borrower does not pledge any property in order to acquire a loan.

if the comp[any decides to pay off its notes payable and issue a $12,000 in long term debts then the current liabilities will reduce by 12,000 while the long term liabilities will increase by 12,000. Net income was $5,500. The company has improved on its liquidity through an increase in the working capital, however the profitability of the company has declined and this is evident from the decline in the return on total assets. Given that the selling price of one rod is $132, variable cost is $80, average fixed cost is $90,000 we can determine the break even point, the break even point is the point where the cost is equal to the revenue, we state the cost and revenue function as