SportZ Ltd. purchases materials and services from various vendors. Money has been borrowed from the Bank of Alberta. Payments to the vendors and the bank are being planned.
a. SportZ has invoices for materials purchased from Platinum Steel Inc. The invoices are for $4242 due 60 days ago, $12 567 due in 30 days, and $18 451 due in 140 days. If SportZ pays all of these invoices today, how much cash is needed? Money is worth 6% per annum.
b. Bank of Alberta loan payments of $11 000 due 35 days ago and $16 000 due in 68 days are to be replaced by a payment of $6000 today and a further payment in 90 days. If interest on these loans is 7.2% per annum, what is the size of the final payment?
c. Prairie Plastics Ltd. is owed two payments of $18 000 due in 60 days and $16 000 due in 120 days. Instead, SportZ has negotiated a new payment agreement in which three equal payments are to be made in 75 days, 100 days, and 200 days. If interest of 9% is charged, what is the size of the equal payments?
d. Creative Inc., a design company, has sent SportZ an invoice for services provided, in the amount of $15 000, due today. Alternatively, they will accept payment of $15 150 in 50 days. What interest rate is being charged?