View Policies Current Attempt in Progress Assume Lessor Corporation wants to recover fair value, plus interest at 12% for its investment of $160,000 in an asset that is to be leased to Lessee Corporation for five years with the annual rental due in advance each year. Click here to view the factor table Calculate, using PV tables, the amount of the annual rental payment, assuming there is no purchase option that is reasonably certain to be exercised by the lesser (under FRS) and no bargain purchase option (under ASPE) or residual value at the end of the lease. (Round factor values to 5 decimal places, eg 1.25124, Round answer to 2 decimal places, eg 52.75 Annual Rental Payment 5 eTextbook and Media Sean for Later Attempts: 0 of 3 used Submit Answer

View Policies Current Attempt in Progress Assume Lessor Corporation wants to recover fair value, plus interest at 12% for its investment of $160,000 in an asset that is to be leased to Lessee Corporation for five years with the annual rental due in advance each year. Click here to view the factor table Calculate, using PV tables, the amount of the annual rental payment, assuming there is no purchase option that is reasonably certain to be exercised by the lesser (under FRS) and no bargain purchase option (under ASPE) or residual value at the end of the lease. (Round factor values to 5 decimal places, eg 1.25124, Round answer to 2 decimal places, eg 52.75 Annual Rental Payment 5 eTextbook and Media Sean for Later Attempts: 0 of 3 used Submit Answer

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

ChapterA: Appendix - Time Value Of Cash Flows: Compound Interest Concepts And Applications

Section: Chapter Questions

Problem 40P

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Vishu
Included in the category of current assets would be: Multiple Choice O the portion of a long-term operating lease that will be used over the next year. cash restricted for the purpose of repaying debt in three years. the portion of long-term equipment expected to be depreciated over the next year. investment in debt securities that mature in five years but which management intends to sell within one year.
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(1) Assume that the lease payments were actually 280,000 per year, that Consolidated Leasing is also in the 25% tax bracket, and that it also forecasts a 200,000 residual value. Also, to furnish the maintenance support, it would have to purchase a maintenance contract from the manufacturer at the same 20,000 annual cost, again paid in advance. Consolidated Leasing can obtain an expected 10% pre-tax return on investments of similar risk. What are its NPV and IRR of leasing under these conditions? (2) What do you think the lessors NPV would be if the lease payment were set at 260,000 per year? (Hint: The lessors cash flows would be a mirror image of the lessees cash flows.)
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An investor is considering purchasing a sale-leaseback with the following 10-year cash flows: ΕΟΥΙ Cash Flows + 0 1 $350,000 2 $357,000 3 $364,140 4 $371,423 5 $378,851 6 $386,428 7 $394,157 8 $402,040 9 $410,081 10 $418,282 + Sale Proceeds $5,333,000 If the seller/lessee in the previous question insists on a purchase price of $5,000,000 today, what would the investor's yield be? 9.56 percent 7.66 percent 8.22 percent 8.03 percent
Required: i.Determine the initial capital of Project A and Project B. If Project A and Project B are mutually exclusive, calculate the Net Present Value (NPV) of Project A and Project B given that the cost of capital is 5%.Based on the NPV method, explain with reason which project should be invested. ii. Axis Sdn. Bhd.’s current investment policy is to accept only investments that are recoverable within 3 years.Calculate the discounted payback period of Project A and Project B if the cost of capital is5%. Based on the calculated discounted payback period of Project A and Project B, advise the company on which new project to select if they are mutually exclusive.