Please need answer Assume your company just sold a mainframe computer. Thecomputer originally cost $300,000 and had accumulateddepreciation of $100,000 on the date of the sale. Instead ofthe buyer paying cash, she gave you a $400,000noninterest-bearing note due and payable in 3 years. Thereis no established exchange price for the computer, and thenote has no ready market. The prevailing rate of interest fora note of this type is 8%. What should your company recordas a gain from the sale of this computer?

Step 1: Define Time Value of MoneyTime value of money suggests that the money you have today is…

Answered: Assume your company just sold a…

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 23MC: Orion Rentals is unable to collect on a note worth $25,000 and has accumulated interest of $250. It...

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Determining Bond Prices, Interest Rates, and Financial Statement Effects Assume Deere & Company's 2012 10-K reports the following footnote relating to long-term debt. Deere's borrowings include $300 million, 7.125% notes, due in 2031 (bolded below). Long-term borrowings at October 31 consisted of the following in millions of dollars: Notes and Debentures 7.85% debentures due 2015 6.95% notes due 2019: ($700 principal) Swapped to variable interest rates of 6.1%-2012, 6.4%6-2011 8.95% debentures due 2019 8-1/2% debentures due 2022 6.55% debentures due 2028 8.10% debentures due 2030 7.125% notes due 2031 Other notes Total 2012 2011 $306 $306 743 734 56 56 105 105 200 200 250 300 Type Issuer Price Corp Deere & CO 133.63 250 300 13 18 $ 1,973 $ 1,969 A recent price quote (from Yahoo! Finance Bond Center) on Deere's 7.125% notes follows. Coupon YTM Current Fitch (%) Maturity (%) Yield (%) Rating Callable 7.125 3-Mar-2031 4.678 5.332 A No This price quote indicates that Deere's 7.125% notes…
Curly's Life Insurance Co. is trying to sell you an investment policy that will pay you and your heirs $25,000 per year forever. A representative for Curly's tells you the policy costs $450,000 Required: At what interest rate would this be a fair deal? (Enter rounded answer as directed, but do not use rounded numbers in intermediate calculations. Enter your answer as a percent rounded to 2 decimal places (e.g., 32.16).) Interest rate |%
Question 2 Your firm would like to take over a manufacturing entity located in Accra, Stacy Ltd. The target company's financial position as of now is presented in the statement of financial position exhibited below. Statement of Financial Position on December 31, 2022 GH₂ ASSETS Current assets Cash Trade and other receivables Inventories Total current assets Noncurrent assets Long-term investments Property, plant, and equipment Total noncurrent assets Total assets LIABILITIES AND EQUITY Current liabilities Bank overdraft Trade payables Interest payable Current tax liability Total current liabilities Noncurrent liabilities Bank loan Obligations under finance lease Total noncurrent liabilities Total liabilities Equity Income surplus Share deals Capital surplus Stated capital Shareholders' fund Total liabilities and equity 35,650.00 380,020.00 89,762.00 505,432.00 20,500.00 1,889,510.00 1,910,010.00 2,415,442.00 14,350.00 480,912.00 11,400.00 28,569.00 535,231.00 90,000.00 75,865.00…
Suppose you have just purchased your first home for $550,000. At the time of purchase you could only afford to commit to a down payment of $55,000. In order to make the loan, the lender requires you to obtain private mortgage insurance (PMI) on their behalf. Suppose over time you paid down the principal of the loan to $535,000 and at that point in time you can no longer make any mortgage payments (i.e., you default on the loan). If the lender were to foreclose on your property and sell it for $508,000 (net proceeds), what would the lender's loss of principal be taking into consideration the protection of mortgage insurance? (Let's assume that the PMI in this case covers the top 25% of the loan.)
Imagine that Commodore has taken out a multimilliondollar loan that must be repaid next year. How might the lender react if it learned that Commodore was using the book-and-hold method to make revenues look higher than they really are?
Mr Mhlaba does not have money to buy cash for the Kenwood.she decides to buy it on higher pechuse deal. The cash was.R7139.99 Special price.R6449 The higher purchase deal intails the ff 15% deposite 18.5% annual simple interest rate on the price less deposit 3years to pay Use the information above to answer the questions that follows 1.define the term.high purchase 2.calculate the discount amount that is given on the kenwood. 3.mr mhlaba paird R974.85 as a deposit on the ken wood.show how the deposit was calculated. 4.calculate the amount of payable after these years excluding the deposit that she already paid. 5.dertimene the number of months that will be after making a monthly payment.
New Venture Corporation has taken out a $5 million, 30-year, 10% mortgage on its new manufacturing facility. a. How much will New Venture pay each month to discharge this mortgage? b. How much of the first payment is for interest, and by how much does it reduce the balance owed? c. How much of the second payment is for interest, and by how much does it reduce the balance owed? How can I solve b and c from the attached solution (solution to a)? Thank you.
Please do not give solution in image format ? And Fast answering please and explain proper steps by Step.
You can buy property today for $3.1 million and sell it in 6 years for $4.1 million. (You earn no rental income on the property.) a. If the interest rate is 7%, what is the present value of the sales price? (Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places.) b. Is the property investment attractive to you? yes or no c-1. What is the present value of the future cash flows, if you also could earn $210,000 per year rent on the property? The rent is paid at the end of each year. (Do not round intermediate calculations. Enter your answer in millions rounded to 3 decimal places.) c-2. Is the property investment attractive to you now? yes or no
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
A friend of yours hasn't taken this cCourse and therefore does not appreciate the time-value of money He offers to pay you back for that time he borrowed money and gives you two options: 1. Two equal payments of $1030, today and in 2 years, or 2. One single payment of $2060 (twice the amount) in 1 year. Now, because you appreciate the time-value of money, you realize that, while the two options appear to have equal value, the two-payment option has a greater value. Assuming money can earn 11% compounded quarterly, how much of a difference is there between the values of the two options? Use today as your focal date and ensure your answer is positive. Answer: $277
The Borstal Company has to choose between two machines that do the same job but have different lives. The two machines have the following costs: Year Machine A Machine B $42,500 10,500 10,500 10,500 + replace $52,500 9,000 9,000 9,000 9,000 + replace 4 These costs are expressed in real terms. Suppose that technological change is expected to reduce costs by 10% per year. There will be new machines in year 1 that cost 10% less to buy and operate than A and B. In year 2, there will be a second crop of new machines incorporating a further 10% reduction, and so on. Suppose you are Borstal's financial manager. If you had to buy one or the other machine and rent it to the production manager for that machine's economic life, what annual rental payment would you have to charge at the end of the first year and how would this alter in subsequent years given the expected technological changes? Assume a 9% real discount rate and ignore E taxes. (Do not round intermediate calculations. Enter your…

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