Determine the amount of each lease payment

Assignment Help Financial Management
Reference no: EM132386836

Question

Peters Company leased a machine from Johnson Corporation on January 1, 2018. The machine has a fair value of $16,000,000. The lease agreement calls for five equal payments at the end of each year. The useful life of the machine was expected to be five years with no residual value. The appropriate interest rate for this lease is 10%.

Other information:

PV of an ordinary annuity @10% for 5 periods: 3.79079

PV of an annuity due @10% for 5 periods: 4.16987

Required:

1. Determine the amount of each lease payment.

2. 3. & 4. Prepare the appropriate journal entry.

Reference no: EM132386836

Questions Cloud

What is the probability that they will score greater : On Call of Duty, a certain player scores on average 15 kills per game, with the average game taking 10 minutes. If this person has a day off from work
Determine her agi and itemized deduction for casualty loss : The car had originally cost $40,000. At the time of the accident, the car was worth $20,000 and Alicia had taken $8,000 of depreciation.
Find the probability that the student : (a) Find the probability that the student obtains at least 2 correct answers. (b) Find the mean and variance of X.
Define how society supposedly works : Think about which have been the most influential forms of mass media throughout your own personal socialization. How have the mass media impacted your beliefs.
Determine the amount of each lease payment : Peters Company leased a machine from Johnson Corporation on January 1, 2018. The machine has a fair value of $16,000,000.
What are the commonalities among people who grieve : Need someone to write a 5 page paper (not including title or reference page) examining the process of grief and bereavement, and then offer suggestions.
Briefly discuss basic requirements of public companies : Briefly discuss Basic requirements of public companies in reporting segmental date. The response paper should be in APA format.
Prepare a statement of earnings for peters curling inc : Prepare a statement of earnings for Peter's Curling Inc. for the month of October 2017. Use an income tax rate of 30 percent.
Describe the assessment you have been assigned : Research one of the following evaluative protocols (based on your first name) that might be used by an I/O psychologist or manager to assess an employee's.

Reviews

Write a Review

Financial Management Questions & Answers

  Two of these factors affect equilibrium exchange rate

Identify the factors which determine changes in equilibrium exchange rate. Discuss how any two of these factors affect equilibrium exchange rate.

  How an audit can result in substantial saving in the entity

Discuss information risk and give example on how an audit can result in substantial saving in the entity?

  Compute required revenue to achieve target operating income

Compute the required revenue to achieve the target operating income and compute a contribution income statement to prove the totals.

  Determine whether or not you believe that applersquos

use the internet to research the apple corporation its current position and reputation regarding ethical and social

  The prices and other information of two stocks in market

The prices and other information of two stocks in the market are listed in the table: Stock BHP: Price at year beginning ($50) Forecasted price at year end ($52) Forecasted dividend in the year ($3) Variance of returns (9%) Stock CBA: Price at year b..

  Assets at the fire–sale price

If a bank sells $100 of assets at the fire–sale price of $50, the balance sheet effect is to

  What is the annual payment on loan for cooley landscaping

What is the annual payment on this loan for Cooley Landscaping?

  What is equivalent annual cost of buying and maintaining

What is the equivalent annual cost of buying and maintaining the truck if the discount rate is 12%?

  Revenue associated with the price reduction of sauce

What is the incremental revenue associated with the price reduction of sauce?

  Company is considering two mutually exclusive projects

Your company is considering two mutually exclusive projects, X and Y, whose costs and cash flows are shown below:

  What is the yield on ninety-day risk-free securities

Assume that interest rate parity holds. In both the spot market and the 90-day forward market 1 Japanese yen equals 0.0086 dollar. In Japan, 90-day risk-free securities yield 4.9%. What is the yield on 90-day risk-free securities in the United States..

  Maturity risk premium between a 10 year bond and 1 year bond

If the yield on 10-year U.S. Treasury bonds is 12 percent, what is the maturity risk premium between a 10-year bond and a 1-year bond?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd