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Katen [24]
3 years ago
7

Metcalf Company leases a machine from Vollmer Corp. under an agreement which meets the criteria to be a finance lease for Metcal

f. The six-year lease requires payment of $170,000 at the beginning of each year, including $25,000 per year for maintenance, insurance, and taxes. The incremental borrowing rate for the lessee is 10%; the lessor's implicit rate is 8% and is known by the lessee. The present value of an annuity due of 1 for six years at 10% is 4.79079. The present value of an annuity due of 1 for six years at 8% is 4.99271. Metcalf should record the leased asset at:________
a. $848,760
b. $814,435
c. $723,943
d. $694,665
Business
1 answer:
tresset_1 [31]3 years ago
4 0

Answer:

the lease asset is $723,943

Explanation:

The computation of the lease asset is shown below;

= (Lease payment - per year maintenance charges) × present value of an annuity due of 1 for six years at 8%

= ($170,000 - $25,000) × 4.99271

= $145,000 × 4.99271

= $723,943

hence, the lease asset is $723,943

The same would be considered

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You currently own shares in Buckeye Mutual Fund (BMF). Your broker calls and recommends buying shares in a small-capitalization
GarryVolchara [31]

Answer:

Option D is the correct option

Explanation:

To find the optimal fund to combine with risk free rate of return, we will use Coefficient of variation,

Coefficient of variation(CoV) = Standard Deviation/Expected Return

CoV of Buckeye = 14%/20% = 0.7

CoV of Wolverine = 11%/12% = 0.9167

So, higher the CoV higher the risk, we will take Buckeye to combine with Risk Free Return.

Hence, Option A

- Required target return of portfolio = 22%

Risk Free return = 8%

Buckeye Return = 20%

Let the weight of Buckeye be X ,& weight of risk free be (1-X)

Required return = (WRF)*(RRF) + (WB)*(RB)

22 = (1-X)(8) + (X)(20)

22 = 8-8X + 20X

14 = 12X

X = 1.17

SO, weight of Buckeye is 1.17 or 117%

while weight of Risk free is -0.17 (1-1.17) or -17%

Hence, ans is OPTION D

7 0
2 years ago
Accounts Receivable from sales to customers amounted to $80,000 and $70,000 at the beginning and end the year, respectively. Inc
Kipish [7]

Answer:

$332,000

Explanation:

<u>Cash flow from operating activities</u>

Net Income                                                                                  $252,000

Adjust for changes in working capital items :

Decrease in Accounts Receivable ($80,000 - $70,000            $80,000

Net Cash Provided by Operating Activities                              $332,000

Conclusion

the cash flows from operating activities to be reported on the statement of cash flows is $332,000

5 0
3 years ago
Munoz, Inc., produces a special line of plastic toy racing cars. Munoz, Inc., produces the cars in batches. To manufacture a bat
cestrela7 [59]

Answer:

Explanation:

1. Calculate the efficiency variance for variable overhead setup costs.

This will be calculated as:

= Standard Hours - Actual Hours) × Standard rate

= (15000/225 × 5.25 - 15000/250 × 5) × 38

= (350 - 300) × 38

= 50 × 38

= 1900 Favourable

2) Calculate the rate variance for variable overhead setup costs.

This will be:

= Standard rate- Actual rate) × Actual Hour

= (38-40) × (15000/250 × 5)

= -2 × 300

= -600 Unfavourable

3) Calculate the flexible-budget spending variance for variable overhead setup costs.

This will be the difference between the standard cost and the actual cost. This will be:

= (15000/225×5.25 ×38) - (15000/250×5 ×40)

= 13300 - 12000

= 1300 Favourable

4) Calculate the spending variance for fixed setup overhead costs.

what formular did you use.

This will be:

= Standard Cost - Actual Cost

= 9975-12000

= -2025 Unfavorable

5 0
3 years ago
Hich of the following industries is not considered to be defensive?
AnnyKZ [126]

The correct option is Building materials.

Building materials:

  • 1: a building constructed for long-term usage that is typically walled and roofed (as for a dwelling) 2: the process of putting together materials to form a structure. Synonyms Example Sentences Phrases containing structure Learn More About Construction.
  • Any kind of man-made construction is a structure. It might be a dam or a bridge, for instance. In contrast, a building is a closed construction with walls and a roof.
  • The following structures are included in the definition of a building: Walls, floors, roofs, chimneys, plumbing and drainage systems, fixed constructions, etc. are examples of structural components. Verandas or atriums, balconies, cornices, building projections that extend past the structure's outside walls, etc.

Learn more about building materials here brainly.com/question/9779427

#SPJ4

6 0
1 year ago
Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity Bank all have zero excess reserves. The required reserv
sergey [27]

Answer:

hmmmmmmmmmmmmm

Explanation:

4 0
3 years ago
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