For part bOption(5) 7 yearsOption (6) 8 yearsOption (7) 9 yearsOption (8) 10 years You want to invest in a new small business venture. If you invest $10,000, you have aguaranteed payment of $850 at the end of the 1st year, $1,200 the following year,$1,800 after that and then $2,000 annually going forward for as long as you keepyour money in the business. Your MARR is 8% annually.(a) What is the discounted cash flow at year 5? Select between options 1 to 4 below.(b) What is the discounted payback period on your investment? Assume the cashflow is received at the end of the year. Select between options 5 to 8 below.Select 2 correct answer(s)OOption 1 (Part a):$1,361Option 2 (Part a):$1,567OOption 3 (Part a):-$3,924Option 4 (Part a):$2,000

Cash Outflow at Year 0 = $10,000 Cash Outflow at Year 1 = $850 Cash Outflow at Year 2 = $1,200 Cash…

Answered: You want to invest in a new small…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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PROBLEM 10: LEASE MODIFICATION WITH EXTENSION of lease term Laze Company entered into a lease agreement for a stall space for its products on January 1, 2020. Some of the agreement in the lease contract are as follows: Annual rental payable at end of each year starting December 31, 2020 P350,000 Lease term 6 years Implicit interest rate in the lease 10% Laze Company proposed an amendment on the original lease contract on January 1, 2023, and was approved by the lessor. The amendment is to extend the lease term for another 2 years with the following additional features: Annual rental payable at end of each year starting December 31, 2023 P350,000 Implicit interest rate in the lease 11% REQUIRED:: Prepare table of amortization and journal entries for the entire lease term.
2. On January 1, 2022, ABC Corporation entered into a 60-day put option contract for $30,000. Based on the PHP-USD rates below, what is the intrinsic value of the contract on Mar. 2, 2022? January 1, 2022 Spot Rate 30-day Forward Rate 60-day Forward Rate January 30, 2022 Spot Rate 30-day Forward Rate 60-day Forward Rate Mar. 2, 2022 Spot Rate 30-day Forward Rate 60-day Forward Rate Buying Rate 55.10 55.41 55.93 Buying Rate 55.38 55.71 56.04 Buying Rate 55.88 55.93 55.95 Selling Rate 55.67 55.43 55.96 Selling Rate 55.75 56.17 56.61 Selling Rate 55.73 55.79 55.82
Date of commencement of lease - July 1, 2022 Duration of lease - 8 years Implicit rate of interest - 6% Initial up-front payment - P200,000 Lease payments at the end of each year - P100,000
Alto Leases a car on 1st Jan 2020 for 2 years Option to extend 1 more year (reasonably certain to exercise) Useful life 10 years Lease payments $10,000/ year for 2 years Lease payment $15,000 for extension (1 year) Direct costs of $3,000 Interest rate is 5% All payments are due at the end of the year Determine initial carrying amount asset and liability
On July 1, 2020 an entity entered into an 8-year lease of a floor of a building with the following terms: Annual rental for the first three years payable at the end of each year 300,000 Annual rental for the next five years payable at the end of 400,000 each year Implicit interest rate 10% Compute the balance of lease liability on December 31, 2020. (Use four decimal places for your present value ex:1.3284) O 1,773,408 O 1,884,916 O 1,138,816 O 1,829,152
Assuming the leasehold yield is 2% above the freehold yield, calculate the Years Purchase (YP) dual rate for 10 years if the accumulative rate is 3% and that a comparable freehold property let at full market rent of $40,000 has just been sold for $500,000. Hint: Analyse the market yield from the comparable first and then use it to calculate the required YP. 4.3872 7.3625 6.1250 5.3410
2. An entity entered into a lease of building on January 1, 2019 with the following information: Annual rental payable at the end of each year - 500,000 Lease term - 5 years Useful life of building - 20 years Implicit interest rate - 10% The lease contained an option for the lease to extend for a further 5 years. At the commencement date, the exercise of the extension option is not reasonably certain. After 3 years, however, on January 1, 2022, the lessee decided to extend the lease for a further 5 years. New annual rental payable at the end of each year - 600,000 New implicit interest rate - 8% On January 1, 2022, the present value of lease liability is (Round off final answer to whole number)
Sheridan Ltd. entered into a lease on June 1, 2023. The lease term is six years and requires annual rental payments of $27,900 at the beginning of each year. Sheridan's incremental borrowing rate is 5% and the rate implicit in the lease is 9%. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY DUE. (a) Your answer is correct. Calculate the capitalized amount of the right-of-use asset if Sheridan follows IFRS. (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 2 decimal places, e.g. 5,275.75.) (b) Leased asset eTextbook and Media * Your answer is incorrect. 136421.24 i Attempts: 1 of 3 used Calculate the capitalized amount of the leased asset if Sheridan follows ASPE. (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 2 decimal places, e.g. 5,275.75.) Leased Asset $ 148701.42
You need a 19000 loan option 1 a 30 year loan at apr of 7.5 option 2 a 15 year loan at apr of 6.5 what is the monthly payment for option 1 what is the monthly payment for option 2 what is the total payment of each which loan is better
a. Choice 1 b. Choice 5 c. Choice 3 d. Choice 4 e. Choice 2
ABC Enterprises entered into a five-year lease agreement on 1 November 2020, paying£10,975 per annum, commencing on 31 October 2021. The present value of the lease payments was £45,000 and the interest rate implicit to the lease was 7% What is the amount to be shown within non-current liabilities at 31 October 2021? Show your calculations.
5f

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