National Leasing leases equipment to a variety of businesses. The company's primary service is providing alternate financing by acquiring equipment and leasing it to customers under long-term leases. National earns interest under these arrangements at a 10% annual rate.
The company leased production equipment it purchased on December 31, 2020 for $270,000 to a local company, Madison Inc. The six-year operating lease term commenced January 1, 2021, and the lease contract specified annual payments of $24,000 beginning December 31, 2021 and each December 31 through 2026. The machine's estimated useful life is 15 years with no estimated residual value.
Madison had the option to terminate the lease after four years. At the beginning of the lease, there was no reason to believe the lease would be terminated.
Required:
Round your answers to the nearest whole dollar amounts.
1.Prepare the appropriate journal entries for National Leasing from the beginning of the lease through the end of 2021.
2.At the beginning of 2022, there was a significant indication that Madison's economic incentive to terminate the lease had changed causing both companies to believe termination of the lease at the end of four years (three years remaining) is "reasonably certain". Prepare any appropriate entries for National Leasing at January 1, 2022, to reflect the change in the lease term.
3.Prepare the appropriate journal entries pertaining to the lease for National Leasing at December 31, 2022.
In: Accounting
Draw bifurication diagram of:
(x^2-a)(x^2-4)
In: Advanced Math
Problem 2
|
Maturity |
Spot Rate |
|
1 |
5.0700 |
|
2 |
5.1248 |
|
3 |
5.1873 |
|
4 |
5.2557 |
|
5 |
5.3281 |
|
6 |
5.4026 |
|
7 |
5.4773 |
a) Compute the Forward Rate Curve for the adjacent Term Structure
b) Price 5 year, 8% annual coupon bond. Assume these are risk adjusted rates.
c) Show that you will arrive at the same price by using the forward rates
Problem 3
What is the YTM of the above bond? What should its Par yield be?
In: Finance
|
Case 2 Geo Tech Cash Flow Template (Base Case) |
|||||||||
| Year | 0 | 1 | 2 | 3 | 4 | 5 | |||
| $600,000.00 | $1,080,000.00 | $1,050,000.00 | $750,000.00 | $570,000.00 | |||||
| Revenues | |||||||||
|
Cash Costs |
|||||||||
|
Set up |
$280,000.00 | $420,000.00 | $280,000.00 | $140,000.00 | $140,000.00 | ||||
|
Other operating |
$240,000.00 | $240,000.00 | $360,000.00 | $360,000.00 | $240,000.00 | ||||
|
Depreciation |
$280,000.00 | $280,000.00 | $280,000.00 | ||||||
| EBIT | -$200,000.00 | $140,000.00 | $130,000.00 | $250,000.00 | $190,000.00 | ||||
| Taxes | -$70,000.00 | $49,000.00 | $45,500.00 | $87,500.00 | $66,500.00 | ||||
|
Net Operating Income After Taxes |
-$130,000.00 | $91,000.00 | $84,500.00 | $162,500.00 | $123,500.00 | ||||
|
Add Depreciation |
$280,000.00 | $280,000.00 | $280,000.00 | ||||||
|
Net Operating Cash Flows |
$150,000.00 | $371,000.00 | $364,500.00 | $162,500.00 | $123,500.00 | ||||
|
Recovery of Capital Assets (AT) |
$65,000.00 | ||||||||
|
Project Cost |
-$840,000.00 | ||||||||
|
Total Cash Flow (CAD) |
-$840,000.00 | $150,000.00 | $371,000.00 | $364,500.00 | $162,500.00 | $188,500.00 | |||
|
Exchange Rate |
0.860 | 0.860 | 0.860 | 0.860 | 0.860 | 0.860 | |||
|
Total Cash Flow (USD) |
-$722,400.000 | $129,000.000 | $319,060.000 | $313,470.000 | $139,750.000 | $162,110.000 |
Adjust with below FX rates and inflation, calculate NPV and IRR with FX rates and inflation. Note the base case has been solved. Just looking for adjustments to the last 3 rows with below inflation and FX rates. Show on Excel.
| FX Forecast | ||||||
| Project Year | 0 | 1 | 2 | 3 | 4 | 5 |
| Calendar Year | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
| FX Rate | 0.860 | 0.825 | 0.805 | 0.790 | 0.780 | 0.775 |
| US Inflation | 1.50% |
| CAD Inflation | 1.75% |
In: Finance
1.Determine the linearization of
f(x)= −2.0 x^2.0−4.0 x - 4
at x=2.
2.Determine the linearization of f(x)= (−x^2)−4/x^3 at x=−1.
In: Math
Comprehensive Problem 4
Part 2:
Note: You must complete part 1 before part 2.
After all of the transactions for the year ended December 31, Year 1, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data that follows were taken from the records of Equinox Products Inc.
| Income statement data: | |
| Advertising expense | $150,000 |
| Cost of merchandise sold | 3,700,000 |
| Delivery expense | 30,000 |
| Depreciation expense—office buildings and equipment | 30,000 |
| Depreciation expense—store buildings and equipment | 100,000 |
| Dividend revenue | 4,500 |
| Gain on sale of investment | 4,980 |
| Income from Pinkberry Co. investment | 76,800 |
| Income tax expense | 140,500 |
| Interest expense | 21,000 |
| Interest revenue | 2,720 |
| Miscellaneous administrative expense | 7,500 |
| Miscellaneous selling expense | 14,000 |
| Office rent expense | 50,000 |
| Office salaries expense | 170,000 |
| Office supplies expense | 10,000 |
| Sales | 5,254,000 |
| Sales commissions | 185,000 |
| Sales salaries expense | 385,000 |
| Store supplies expense | 21,000 |
| Retained earnings and balance sheet data: | |
| Accounts payable | $194,300 |
| Accounts receivable | 545,000 |
| Accumulated depreciation—office buildings and equipment | 1,580,000 |
| Accumulated depreciation—store buildings and equipment | 4,126,000 |
| Allowance for doubtful accounts | 8,450 |
| Available-for-sale investments (at cost) | 260,130 |
| Bonds payable, 5%, due 20Y2 | 500,000 |
| Cash | 246,000 |
| Common stock, $20 par (400,000 shares authorized; 100,000 shares issued, 94,600 outstanding) | 2,000,000 |
| Dividends: | |
| Cash dividends for common stock | 155,120 |
| Cash dividends for preferred stock | 100,000 |
| Goodwill | 500,000 |
| Income tax payable | 44,000 |
| Interest receivable | 1,125 |
| Investment in Pinkberry Co. stock (equity method) | 1,009,300 |
| Investment in Dream Inc. bonds (long term) | 90,000 |
| Merchandise inventory (December 31, Year 1), at lower of cost (FIFO) or market | 778,000 |
| Office buildings and equipment | 4,320,000 |
| Paid-in capital from sale of treasury stock | 13,000 |
| Excess of issue price over par—common stock | 886,800 |
| Excess of issue price over par—preferred stock | 150,000 |
| Preferred 5% stock, $80 par (30,000 shares authorized; 20,000 shares issued) | 1,600,000 |
| Premium on bonds payable | 19,000 |
| Prepaid expenses | 27,400 |
| Retained earnings, January 1, Year 1 | 9,319,725 |
| Store buildings and equipment | 12,560,000 |
| Treasury stock (5,400 shares of common stock at cost of $33 per share) | 178,200 |
| Unrealized gain (loss) on available-for-sale investments | (6,500) |
| Valuation allowance for available-for-sale investments | (6,500) |
On your own paper, in the working papers, or using a spreadsheet, prepare the following:
a. Prepare a multiple-step income statement for the year ended December 31, Year 1, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were $100,000. (Round earnings per share to the nearest cent.) Save your calculations and enter the requested amounts below.
b. Prepare a retained earnings statement for the year ended December 31, Year 1. Save your calculations and enter the requested amounts below.
c. Prepare a balance sheet in report form as of December 31, Year 1. Save your calculations and enter the requested amounts below.
If required, only use the minus sign to indicate loss before income tax, net loss, or a deficit balance in retained earnings.
| Gross profit | $ |
| Total selling expenses | $ |
| Total administrative expenses | $ |
| Total operating expenses | $ |
| Income from operations | $ |
| Net other expenses and income | $ |
| Income tax | $ |
| Net income | $ |
| Earnings per common share (rounded to the nearest cent) | $ |
| Retained earnings, January 1, Year 1 | $ |
| Total current assets | $ |
| Investment in Dream Inc. bonds | $ |
| Total property, plant, and equipment | $ |
| Total assets | $ |
| Total current liabilities | $ |
| Net long-term liabilities | $ |
| Total liabilities | $ |
| Total paid-in capital preferred 5% stock | $ |
| Total paid-in capital common stock, $20 par | $ |
| Total paid-in capital | $ |
| Retained earnings, December 31, Year 1 | $ |
| Total stockholders' equity | $ |
In: Accounting
| Stumps | Larvae |
| 2 | 10 |
| 2 | 30 |
| 1 | 12 |
| 3 | 24 |
| 3 | 36 |
| 4 | 40 |
| 3 | 43 |
| 1 | 11 |
| 2 | 27 |
| 5 | 56 |
| 1 | 18 |
| 3 | 40 |
| 2 | 25 |
| 1 | 8 |
| 2 | 21 |
| 2 | 14 |
| 1 | 16 |
| 1 | 6 |
| 4 | 54 |
| 1 | 9 |
| 2 | 13 |
| 1 | 14 |
| 4 | 50 |
- How far off are you from the actual number of Beetle larvae from
a cottonwood tree with 5 stumps?
- Does it make sense to use a linear regression model
here? Write a short paragraph about your analysis and carefully
state your case. You should provide at least 2 specific reasons why
this is or is not a good technique to use to predict the number of
clusters of beetle larvae.
- Does it make sense to predict the number of clusters of beetle
larvae if there are zero stumps? Why or why not? What happens when
you do this calculation?
| SUMMARY OUTPUT | |||||||||
| Regression Statistics | |||||||||
| Multiple R | 0.916048 | ||||||||
| R Square | 0.839144 | ||||||||
| Adjusted R Square | 0.831484 | ||||||||
| Standard Error | 6.419386 | ||||||||
| Observations | 23 | ||||||||
In: Statistics and Probability
1. The general formula of alkanes is: (i) CnH2n+2 (ii) CnH2n-2 (iii) CnH2n (iv) CnH2n+4 (v) Cn+2H2n
2. The name of the following compound is: a. Tetrabenzene b. Chrysene c. Coronene d. Anthracene e. Pyrene
3. To achieve noble gas configuration, hydrogen requires………………..whereas chlorine requires…………………in outermost shell. a. Octet, duet b. Singlet, duet c. Duet, octet d. Octet, singlet e. None of the above
4. The ……………. the number of relatively stable resonance contributors, the …………… the resonance energy. a. Higher, lower b. Lower, higher c. Higher, higher d. Lower, lower e. None of the above
5. The other name of Methylbenzene is: (i) Phenyl (ii) Xylene (iii) Pyrene (iv) Toluene (v) Naphthalene
6. In pericondensed polyaromatic hydrocarbon, one or more carbon atoms must be a common member of (i) one (ii) two (iii) three (iv) four (v) five benzene rings.
7. The name of the compound (I) is: H2NCH2CH2CH2CO2H (I) (i) N-methylpropylamine (ii) N,N-dimethylethylamine (iii) 2-aminoethanol v) 4-aminobutanoic acid (v) Succinic acid
8. Benzoyl chloride is an example of (i) Aliphatic acid chloride (ii) Alicyclic acid chloride (iii) Heterocyclic acid chloride (iv) Aromatic acid chloride (v) None of the above
9. Acetyl chloride is an example of (i) Aliphatic acid chloride (ii) Alicyclic acid chloride (iii) Heterocyclic acid chloride (iv) Aromatic acid chloride (v) None of the above
10. Acetic anhydride is an example of (i) Aliphatic acid anhydride (ii) Alicyclic acid anhydride (iii) Heterocyclic acid anhydride (iv) Aromatic acid anhydride (v) None of the above
11. Phthalic anhydride is an example of (i) Aliphatic acid anhydride (ii) Alicyclic acid anhydride (iii) Heterocyclic acid anhydride (iv) Aromatic acid anhydride (v) None of the above
12. Formamide is an example of (i) Aliphatic amide (ii) Alicyclic amide (iii) Heterocyclic amide (iv) Aromatic amide (v) None of the above
13. Benzamide is an example of (i) Aliphatic amide (ii) Alicyclic amide (iii) Heterocyclic amide (iv) Aromatic amide (v) None of the above
In: Chemistry