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vichka [17]
3 years ago
8

Kingbird Company is negotiating to lease a piece of equipment to MTBA, Inc. MTBA requests that the lease be for 9 years. The equ

ipment has a useful life of 10 years. Kingbird wants a guarantee that the residual value of the equipment at the end of the lease is at least $4,000. MTBA agrees to guarantee a residual value of this amount though it expects the residual value of the equipment to be only $2,000 at the end of the lease term. If the fair value of the equipment at lease commencement is $60,000, what would be the amount of the annual rental payments Kingbird demands of MTBA, assuming each payment will be made at the beginning of each year and Kingbird wishes to earn a rate of return on the lease of 6%? (
Business
1 answer:
kolbaska11 [484]3 years ago
8 0

Answer:

$ 7,994

Explanation:

Fair Value of lease 60,000

Less Present value of garanteed residual value$ 2,368

($4000*1/1.06^9)

Amount to be recovered through periodic payment $ 57,632

PVAD (9 years ,6%) 7.20979

Minimum Lease at the beginning of each year (C/D) $ 7,994

Therefore the amount of the annual rental payments Kingbird demands of MTBA, assuming each payment will be made at the beginning of each year and Kingbird wishes to earn a rate of return on the lease of 6 $7,994

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10 roles of insurance in a business
Sedbober [7]

Considering the benefits and importance of insurance, the ten roles of insurance in a business include "<u>security and safety</u>."

<h3>The other roles of insurance in a business are:</h3>
  1. Mitigation of risk
  2. Provision of insurance service by the insurance company
  3. Protection from unexpected losses
  4. Ease of getting loans
  5. Provision of social cooperation
  6. It enhances saving habits
  7. It aids some contracts that require it.
  8. There are tax benefits.
  9. Promotion of trades and industry, etc.

Hence, in this case, it is concluded that insurance plays various roles in business.

Learn more about Insurance here: brainly.com/question/4953989

8 0
2 years ago
On May 1, Shilling Company sold merchandise in the amount of $5,800 to Anders, with credit terms of 2/10, n/30. The cost of the
Illusion [34]

Answer:

The journal entry that is to be recorded on May 1 is shown below:

Explanation:

May 1

The first entry to be posted:

Accounts Receivable A/c...................Dr     $5,800

       Sales A/c............................................Cr      $5,800

As the company made a sale, so the sale is credited and it made against the accounts receivable. Therefore, accounts receivable account is credited.

The second entry to be posted is as:

Costs of goods sold A/c....................Dr   $4,000

       Merchandise inventory A/c...................Cr   $4,000

The cost of the goods sold amounts to $4,000. So, the account of COGS is debited and it is against the inventory. Therefore, the merchandise inventory is credited.

8 0
3 years ago
Cullumber Company’s 12/31/21 balance sheet reports assets of $11450000 and liabilities of $4890000. All of Cullumber’s assets’ b
Arturiano [62]

Answer:

$4,392,000

Explanation:

For computing the cost of the goodwill, first we have to calculate the fair value of the net asset which is shown below:

The fair value of net asset = Asset balance + fair value of land  - liabilities balance

= $11,450,000 + $690,000 - $4,890,000

= $7,250,000

And, the acquire value is $11,642,000

So, the goodwill would be  

= $11,642,000 - $7,250,000

= $4,392,000

4 0
3 years ago
A certificate of deposit allows deposits and withdrawals at any time without a financial penalty.
iogann1982 [59]

Although there is no question here, I am assuming that this is a True/False question because it is a False statement.

A certificate of deposit is an investment with a fixed interest rate for a fixed period of time. There are nearly always penalties for early withdrawal.

3 0
3 years ago
Matt and Joel are equal partners in the MJ Partnership. For the current year ended December​ 31, the partnership has book income
Blababa [14]

Answer:

$86,000

Explanation:

A partnership is a pass through entity that is not taxed directly, but instead its partners are taxed. Even the partners' salaries are recorded as drawings, not salary expense.

The partnership's total ordinary income = book income + any donations or contributions to charities = $80,000 + $6,000 = $86,000

8 0
3 years ago
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