A company leases a machine on January 1, Year One for five years which call for annual payments of $4,000 for the first year and then $10,000 per year after that. The present value of these payments based on a reasonable interest rate of 10 percent is assumed to be $38,000. This lease
GAAP? Explain in detail. (TCO C) (TCO C) Blue Corp. reports operating expenses in two categories: (1) selling and (2) general and administrative. The adjusted trial balance at December 31, 201X, included the following expense accounts. Accounting and legal fees $150,000 Advertising $125,000 Freight-out $65,000 Interest $80,000 Loss on sale of long-term investments $35,000 Officers’ salaries $200,000 Rent for office space $160,000 Sales salaries and commissions $110,000 One half of the rented premises are occupied by the sales department.
12,897 b. 12,720 c. 42,400 d. Other 2. A local bank offers an account that pays 8%, compounded quarterly, for any deposits of $10,000 or more that are left in the account for a period of 5 years. The effective annual rate of interest on this account is: a. 4.65% b.
2. Harley purchased $15,000 of equipment for cash. 3. Harley paid $500 cash to rent space for the first month of operations. 4.
40 miles * 16.5¢/mile=$6.60 per trip * 3 trips/wk=$19.80/wk * 52wks/yr=$1029.60 per year in tax deductible transportation costs. 52. On April 1, 2010, Paul sold a house to Amy. The property tax on the house, which is based on a calendar year, was due September 1, 2010. Amy paid the full amount of property tax of $2,500.
DSO = Receivables / Ave. sales per day Receivables= DSO * Ave. sales per day = 20 * 20,000 Receivables= $400,000 (3-2) Debt Ratio: Vigo Vacations has an equity multiplier of 2.5. The company’s assets are financed with some combination of long-term debt and common equity. What is the company’s debt ratio? Debt ratio = 1 – (1 / Equity multiplier) Debt ratio = 1 – (1/2.5) = 1 - .40 = .60 Debt ratio = 60% (3-3) Market/Book Ratio: Winston Washers’s stock price is $75 per share. Winston has $10 billion in total assets.
The business required £30,000 cash for working capital. The company gets a loan of £450,000 which was transfer into the business bank account in January as shown in appendix 6. The cash budget shows a balance of £3,918 in January and £16,335 February. The loan calculation is shown in appendix 8. This is expected to be paid back within 8 years by monthly paid instalments of £5.718.41 which was calculated on a 5.1% interest rate.
BUSN602 Midterm Exam Set 2 Click Link Below To Buy: http://hwcampus.com/shop/busn602-midterm-exam-2/ Return to Assessment List Part 1 of 1 - 100.0 Points Question 1 of 20 5.0 Points Jill Clinton puts $1,000 in a savings passbook that pays 4% compounded quarterly. How much will she have in her account after five years? A.$1,200.50 B.$1,220.20 C.$1,174.80 D.$1,217.50 Question 2 of 20 5.0 Points An increase in inflation should: A.increase the demand for loanable funds B.decrease the interest rate on loans C.increase the interest rate on loans D.none of the above Question 3 of 20 5.0 Points Economists use a ___________________ framework to explain
The lease option is a 5-year lease with equal before-tax lease payments of $950,000 per year. The borrowing alternative is a 5-year loan covering the entire cost of the scanner at an interest rate of 5%. The after-tax cost of debt is 3%. Should Penn Medical lease the equipment or borrow the
Old press – Originally purchased 3 years ago at an installed cost of $400,000, it is being depreciated under MACRS using a 5-year recovery period. The old press has a remaining economic life of 5 years. It can be sold today to net $420,000 before taxes; if it is retained, it can be sold to net $150,000 before taxes at the end of 5 years. Press A – This highly automated press can be purchased for $830,000 and will require $40,000 in installation costs. It will be depreciated under MACRS using a 5-year recovery period.