Serula Shoes Established a Line of Credit with a Local

question 20

Multiple Choice

Serula Shoes established a line of credit with a local bank.The maximum amount that can be borrowed under the terms of the agreement is $100,000 at an annual rate of 5%.A compensating balance of 10% of the amount borrowed is required.What is the largest amount of money Serula will actually be able to use from the line of credit?

• A)$90,909
• B)$90,000
• C)$111,111
• D)$100,000

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Definitions:

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