Pralow, Inc, leased an asset to Bender Corporation. The cost of the asset to Pralow was $8,000 . Terms of the lease specify four-year life for the lease, an annual interest rate of 1 . percent, and four year-end rental payments. The lease qualifies as a capital lease and is classified as a direct-financing lease. The asset reverts to Pralow after the fourth year, when its residual value is
estimated to be $1,000 . The amount of each rental payment is
a. $2,000.
b. $2,335.
c. $2,501.
d. $2,602.
D
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Which of the following methods of financing would be used if the exporting and importing parties had a strong, long-standing relationship?
A) documentary credit (letter of credit) B) documentary collection C) cash in advance D) sales on open account E) bank draft
Pettijohn Inc.The balance sheet and income statement shown below are for Pettijohn Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over.
Balance Sheet (Millions of $) Assets2016 Cash and securities$ 1,554.0 Accounts receivable9,660.0 Inventories 13,440.0 Total current assets$24,654.0 Net plant and equipment 17,346.0 Total assets$42,000.0 Liabilities and Equity Accounts payable$ 7,980.0 Notes payable5,880.0 Accruals 4,620.0 Total current liabilities$18,480.0 Long-term bonds 10,920.0 Total liabilities$29,400.0 Common stock3,360.0 Retained earnings 9,240.0 Total common equity$12,600.0 Total liabilities and equity$42,000.0 Income Statement (Millions of $)2016 Net sales$58,800.0 Operating costs except depr'n$55,274.0 Depreciation$ 1,029.0 Earnings bef int and taxes (EBIT)$ 2,497.0 Less interest 1,050.0 Earnings before taxes (EBT)$ 1,447.0 Taxes$ 314.0 Net income$ 1,133.0 Other data: Shares outstanding (millions)175.00 Common dividends$ 509.83 Int rate on notes payable & L-T bonds6.25% Federal plus state income tax rate21.7% Year-end stock price$77.69 Refer to the data for Pettijohn Inc.What is the firm's current ratio? A. 0.97 B. 1.08 C. 1.20 D. 1.33 E. 1.47
Offering a promotion during a peak period that has significant forward buying creates even more variable demand than before the promotion
Indicate whether the statement is true or false.
Which one of the following statements concerning production and staffing plans is BEST?
A) Aggregation can be performed along three dimensions: product families, labor, and time. B) A staffing plan is the intermediate link between the business plan and the master production schedule. C) Production plans are based primarily on information from the master production plan. D) A master production schedule is a projected statement of income, costs, and profits.