Use the Information to Answer the Following Question(s)

question 32

Multiple Choice

Use the information to answer the following question(s) .
Cypress Systems Inc., of Florida, agrees to sell specialized hydroponic growing equipment to Landcaster's of Australia. Because the two companies have never done business with each other, Cypress requires a banker's acceptance as payment for the $1,000,000 order. The banker's acceptance carries a 1.4% commission per annum and payment is to be received in 6 months. If Cypress Inc. chooses to discount or sell the banker's acceptance to its bank, the discount rate is 1.00% per annum.
-Refer to Instruction 16.1. What is the size of the discount (not including the commission fee) Cypress must take for receiving the proceeds of the sale today rather than waiting for six months?

• A) $7,000
• B) $5,000
• C) $12,000
• D) $14.000

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Definitions:

Source Amnesia

A memory disorder where an individual can recall certain information but is unable to remember where, when, or how they learned that information.

Facial Expressions

Nonverbal cues that convey emotions, intentions, and reactions through movements of the face.

Mental Replay

The act of mentally revisiting a past event or experience, which can affect an individual's current mood and thoughts.

Repress

To hold back or suppress emotions, desires, or thoughts from conscious awareness.