Charlie's Snake Shop has an outstanding 120-day bank loan of $300,000 at an annual interest...
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Accounting
Charlie's Snake Shop has an outstanding 120-day bank loan of $300,000 at an annual interest rate of 3.90%. The company is required to maintain a 15% compensating balance in its chequing account. What is the annual interest cost on the loan? The company has idle cash in the amount of $20,000 that will count toward the compensating balance. Select one: O a. 2.85% O b. 2.62% c. 2.14% d. 7.96%
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