medium · Private Equity
Asset-based lending (ABL) availability for a distributor is determined by a borrowing base. The company has total receivables of 30M (5M of which are over 90 days past due) and total inventory of 20M (3M of which is obsolete).
If advance rates are 85% for eligible receivables and 50% for eligible inventory, what is the borrowing base?
- $31.25M
- $25.50M
- $35.50M
- $29.75M
Sign up free to see the explanation and track your rank →
More Private Equity practice
- If the GP receives a 20% carry on the profit from Deal A immediately, and the fund eventua
- Following the investment, what is the investor's ownership percentage in the company, assu
- What is the Interest Coverage Ratio?
- A private equity firm is calculating a 'Public Market Equiva… — If the KS-PME score is 1.1
- A sponsor provides an 'Equity Cure' to a portfolio company. What is the standard purpose o
- What is the new effective conversion price for the growth equity investor?
- Which company will report a higher 'Gross Margin' and a higher ending 'Inventory' value on
- What is the company's Interest Coverage Ratio?