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Drawing on a line a credit: Borrowing Base

  • 1.  Drawing on a line a credit: Borrowing Base

    Posted 10-29-2018 19:37
    We recently changed banks for a larger line with a better rate.
    The new bank figures the borrowing base on 75% of eligible receivables, less the value of "contra" accounts.
    They are deducting  the net over/underbillings from the eligible receivables base.
    We are net overbilled at 9.30, (a liability) the bank is reducing our borrowing base by that amount. Has anyone else experienced this?

    All comments welcome.

    Daniel J DiNardo, Controller,
    Stenton Corporation

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    610-521-5570
    Daniel J DiNardo, Controller,
    Stenton Corporation
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