1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
PolarNik [594]
3 years ago
5

22. On January 1, 2021, Princess Corporation leased equipment to King Company. The lease term is eight years. The first payment

of $675,000 was made on January 1, 2021. The equipment cost Princess Corporation $3,600,000. The present value of the lease payments is $3,961,183. The lease is appropriately classified as a sales-type lease. Assuming the interest rate for this lease is 10%, how much interest revenue will Princess record in 2022 on this lease
Business
1 answer:
ss7ja [257]3 years ago
8 0

Answer:

$293,980.13

Explanation:

Calculation of how much of the interest revenue Princess will record in 2022 on the lease

First Step is to find the interest for year 2021

Present Value January 1, 2021 $3,961,183

Less Payment January 1, 2021 (675,000)

=$3,286,183

Hence,

2021 Interest =$3,286,183× 10%

2021 Interest = $328,618.3

Second Step

Second Payment $675,000

Less Interest (328,618.3)

Reduced balance $346,381.7

Third Step is to find the how much interest revenue will Princess record in 2022 on the lease

2021 $3,286,183

Less Reduced balance (346,381.7)

January 1 2022 Liability = $2,939,801.3× 10%

2022 Interest Revenue =$293,980.13

Therefore the amount of interest revenue that Princess will record in 2022 on the lease will be $293,980.13

You might be interested in
Real Estate tax, a tax based on the value of the land and the buildings owned by its taxpayers, is a good example of _____. A. I
sesenic [268]
C is the answer property tax
4 0
3 years ago
Salespeople at Janie's Cookie Company want to draw the attention of their customers through blogs, Twitter, and LinkedIn, rather
Serga [27]

Answer:

D. Inbound Marketing

Explanation:

When a company uses blogs and social media, to draw the customers through content. And this is called Inbound Marketing, a passive, subtle and digital way to market.

7 0
3 years ago
Which is the best measurement to use to determine who might have the absolute advantage?
Makovka662 [10]

Answer:

<u>low opportunity cost</u>

Explanation:

<u>Opportunity cost</u> is described as a process in which an individual sacrifices something when they tend to choose one thing or option over another option or thing.

<u>Low opportunity cost: </u>The term "low opportunity cost" is determined as the possibility of an individual's chosen investment returns to be lower than the forgone investment's returns.

4 0
3 years ago
Who faces limited liability, in the form of money, for the firm's debts in a corporation?
telo118 [61]
The individual stockholders face limited liability in the form of money
8 0
3 years ago
Read 2 more answers
The Baldwin Company currently has the following balances on their balance sheet: Total Liabilities $73,225 Common Stock $12,173
ankoles [38]

Answer:

Their total assets next year has to be $124,725

Explanation:

<em>Step 1: Determine the initial assets and liabilities</em>

The total assets can be expressed as;

A=C+E

where;

A=total assets

C=common stock

E=retained earnings

In our case;

A=unknown

C=$12,173

E=$91,949

replacing;

A=12,173+91,949=$104,122

<em>Step 2: Determine total liabilities</em>

Total liabilities=initial liability+dividends

where;

Initial liability=$73,225

dividends=$15,000

replacing;

Total liabilities=73,225+15,000=$88,225

<em>Step 3: Determine new assets</em>

Using the formula;

Net profit=new assets-total liabilities

where;

Net profit=$36,500

new assets=unknown=n

total liabilities=$88,225

replacing;

36,500=n-88,225

n=36,500+88,225=$124,725

n=$124,725

Their total assets next year has to be $124,725

<em />

6 0
3 years ago
Other questions:
  • If the commercial mortgages on the balance sheet of this bank decline in value then the value of the bank's equity will rise.a.
    8·1 answer
  • Michael, a systems analyst, is preparing a closed wiki site for Northstate Bank. He has written permission from eight other comp
    15·1 answer
  • If Kindle e-readers and Nook e-readers are substitutes, a higher price for Nooks would result in a(n) ______.
    6·1 answer
  • Fey Corporation has aged its accounts receivable and estimated uncollectible accounts as follows (in thousands). What bad debt e
    6·1 answer
  • Besides the actual mortgage payment, which also factors into the monthly payment on a home?
    6·1 answer
  • Which of the following asset accounts is increased when a receivable is collected? a.Accounts Payable b.Supplies c.Cash d.Accoun
    11·1 answer
  • In a purchases-payables computer system, a purchase order is created after which document has been processed?
    8·1 answer
  • Which TWO of the following statements are TRUE when a broker-dealer executes a principal transaction?
    6·1 answer
  • The Simon Company (SIMON) currently has $300,000 market value (and book value) of perpetual debt outstanding carrying a coupon r
    10·1 answer
  • The decrease in total surplus that results from a market distortion, such as a tax, is called a a. consumer surplus loss. b. wed
    12·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!