Академический Документы
Профессиональный Документы
Культура Документы
Values
700,000
90
1.000%
4.000%
700,000
(1,750)
(7,000)
691,250
5.063%
Values
700,000
90
1.00
1.02
1.000%
4.000%
700,000
(1,750)
698,250
1.00
698,250
700,000
(1,750)
698,250
1.02
712,215
$
$
698,250
712,215
8.000%
Motoguzzie exports large-engine motorcycles (greater than 700cc) to Australia and invoices its
customers in U.S. dollars. Sydney Wholesale Imports has purchased $3,000,000 of merchandise
from Motoguzzie, with payment due in six months. The payment will be made with a bankers
acceptance issued by Charter Bank of Sydney at a fee of 1.75% per annum. Motoguzzie has a
weighted average cost of capital of 10%. If Motoguzzie holds this acceptance to maturity, what is
its annualized percentage all-in-cost?
Assumptions
Value of shipment
Credit terms, days
Bankers' acceptance fee
Motoguzzie's WACC, per annum
All-in-cost of Bankers' Acceptance
Face amount of bankers' acceptance
Less acceptance fee for 6-month maturity
( face amount x acceptance fee x (term/360))
Amount received by Indian
Opportunity cost of capital @ Motoguzzie's WACC
(amount received x WACC x 180/360)
Annualized percentage all-in-cost (AIC)
(acceptance fee +opportunity cost) / (amount received) x (360/180)
Values
3,000,000
180
1.750%
10.000%
3,000,000.00
(26,250.00)
2,973,750.00
148,687.50
11.765%
Values
3,000,000
180
1.750%
10.000%
6.000%
3,000,000.00
(26,250.00)
(90,000.00)
2,883,750.00
8.062%
$
$
$
$
Values
200,000
40,000
180
2.000%
3.000%
200,000.00
(40,000.00)
160,000.00
(1,600.00)
(2,400.00)
156,000.00
5.128%
$
$
40,000
156,000.00
196,000.00
Bank of Zurich, a Swiss forfaiter, has agreed to buy the 5 notes of $200,000 each at a discount.
The discount rate would be approximately 8% per annum based on the expected 3-year LIBOR rate
plus 200 basis points, paid by Umaru Oil. Bank of Zurich also would charge Umaru Oil an
additional commitment fee of 2% per annum from the date of its commitment to finance until
receipt of the actual discounted notes issued in accordance with the financing contract. The
$200,000 promissory notes will come due on March 1 in successive years.
The promissory notes issued by Umaru Oil will be endorsed by their bank, Lagos City Bank, for
a 1% fee and delivered to Gunslinger Drilling. At this point Gunslinger Drilling will endorse the
notes without recourse and discount them with the forfaiter, Bank of Zurich, receiving the full
$200,000 principal amount. Bank of Zurich will sell the notes by re-discounting them to investors
in the international money market without recourse. At maturity the investors holding the notes will
present them for collection at Lagos City Bank. If Lagos City Bank defaults on payment, the
investors will collect on the notes from Bank of Zurich.
a. What is the annualized percentage all-in-cost to Umaru Oil of financing the first $200,000 note
due March 1, 2011?
b. What might motivate Umaru Oil to use this relatively expensive alternative for financing?
Assumptions
Face amount of the note due March 1, 2011 issued by Umaru
3-year LIBOR rate, per annum
Basis point spread, per annum
Total discount rate, per annum
Bank of Zurich commitment fee, per annum
Lagos City Bank endorsement fee, per annum
Values
200,000
6.000%
2.000%
8.000%
2.000%
1.000%
200,000
(2,000)
(4,000)
(16,000)
178,000
11.000%
Values
100,000
180
5.000%
1.500%
6.500%
20.000%
1.000%
100,000
(3,250)
(20,000)
76,750
8.469%
100,000
(1,000)
(2,500)
(20,000)
76,500
9.150%
Values
100,000
180
16.000%
2.000%
100,000
(8,000)
(2,000)
90,000
22.222%
Phangs bank issues a letter of credit on behalf of Phang, and agrees to accept Whatchamacallits
draft for $100,000 due in six months. The acceptance fee would cost Whatchamacallit $500, plus
reduce Phangs available credit line by $100,000. The banker's acceptance note of $100,000 would
be sold at a 2% per annum discount in the money market. What is the annualized percentage all-in
cost to Whatchamacallit of this banker's acceptance financing?
Assumptions
Principal of note
Maturity of note, days
Acceptance fee to be paid by Whatchamacallit
Discount on sale of note, per annum
Letter of credit fee paid by Phang
Reduction in Phang's available credit line
All-in cost to Whatchamacallit:
Face amount of note
Less acceptance fee
Less interest
Net proceeds
Annualized all-in cost of financing
( total interest and fee costs / net proceeds ) x (360/maturity)
$
$
$
$
Values
100,000
180
500
2.000%
500
100,000
100,000
(500)
(1,000)
98,500
3.046%
a. All-in-cost to Whatchamacallit:
Face amount
Less credit insurance fee
Less interest on credit line
Net proceeds
Annualized all-in cost of financing
( total interest and fee costs / net proceeds ) x (360/term of note)
Values
100,000
180
1.500%
6.000%
Values
100,000
(1,500)
(3,000)
95,500
9.424%
Calculation
4180
% of CFR
34.00
4.32
38.32
0.86
39.18
2.250%
2.50
R$97.95
2.50
1.96
2.70
1.27
0.01
0.26
1.96
0.05
1.47
R$107.63
2.000%
25.00%
1.300%
14.00
20.000%
2.000%
50.00
1.500%
% of CIF
% of freight
% of CIF
R$12 per container
% of storage & handling
% of CIF
R$50 per container
% of CIF
1.47
6.86
23.19
139.15
1.500%
7.000%
20.000%
% of CIF * months
% of CIF * months
% of Price + storage + cc
20.87
28.80
56.65
245.48
15.000%
18.000%
30.000%
% of price to retailer
% of price + IPT2
% of price + IPT2 + ICMS2
Bags of 8
per case
Diapers per
case
Price to Consumer
(R$/diaper)
44
32
24
22
352
256
192
176
R$0.70
R$0.96
R$1.28
R$1.39
Export insurance
CIF to Brazilian port
Exchange rate (R$/US$)
CIF to Brazilian port (R$)
Brazilian Importation Costs
Import duties (ID)
Merchant marine renovation fee (MMRF)
Port storage fees
Port handling fees
Additional handling tax
Customs brokerage fees
Import license
Local transportation charges
Total cost to distributor (R$)
DIAPER PRICES
Small
Medium
Large
Extra Large
Rate
968