Response to Client Request Acc541

Your first attempt at generating the financial statements is commendable. I have outlined and included an analysis and recommendation to deal with each issue you identified in your notes. Attached is an Excel file in which you will find the correcting entries, the required adjustments to the draft Financial Statements and additional details related to calculations for the lease agreement.

Agro-Chem, Inc. is a regional producer of agricultural chemicals based in Houston Texas that needs help making a lease versus purchase decision. By understanding the material presented, we will be able to come to a decision. However, after reviewing the information presented, there are a few problems that need to be investigated before finalizing our recommendation. Agro-Chem, Inc. chose to go with the financial manager’s idea of using a discount rate of 14% (average risk) to figure out the present value costs of leasing and purchasing even though the assistant treasure suggested a 12% (low risk) discount rate. Agro-Chem, Inc. brought in the company’s CPA to help settle the debate

(c) The term of the lease is equal to 75% or more of the estimated economic life of the leased asset.

The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and requires an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets and whether the arrangement

The paperwork is needed so that the inventory can be check and figured out the true value of the inventory. A better way at looking any logical justification for cost or market inventory valuation is that a stock of items is necessary to expedite production and sales. If inventory become obsolescence, goes through physical deterioration, and price declines occur, or even if the stock when finally utilized cannot be expected to realize its stated cost plus a normal profit margin. Reduction in inventory value is an additional cost of the goods produced and sold during the time that they decline value occurred

As a team, we chose to look at the lease purchase model for the consumers which is a part of our KPI’s, to improve profit gain from long-term leasing options. Dictionary.com states that a leasing “a contract or instrument conveying the property to another for a specified period or a period determinable at the will of either lessor or lessee in consideration of rent or other compensation.” Aarons pride themselves as “(NYSE: AAN), a leading omnichannel provider of lease-purchase solutions.” (“Press Release-Aaron’s,” n.d.) The publicly traded company this group has selected is Aaron’s. Our team is defining the purpose of Aaron’s Rental Company as, “Business analytics are purposeful when we know why we create the information and perform the analytic

This memo is in regard to the recent proposal of leasing or buying the bi-level and tri-level Auto Rack equipment for Burlington Northern Railroad Company. As indicated before, this equipment is a great investment for our company as it exceeds our company’s 20% hurdle rate and therefore investing in them would be a great decision for the company. Hence this memo will seek to explain the optimal way to finance this investment; in other words, this memo will try and

Global Financial Corporation (GF) a subsidiary of Global Equipment Company (GEC) is tasked with handling financing for those customers who wish to purchase GEC heavy equipment. Currently GF only processes 51% of the leases within the “10 days or less” time frame, with some loans taking up above 41 days. Ms. Rodriguez, the Vice President of GF has been directed to decrease loan processing time to 10 days or less with the current staff she has. The current structure of the analysis and evaluation stage does not maximize staff time effectively and as a consequence creates a bottleneck in the process. We recommend switching to a case manager structure. lLan applications can be processed and

What are the key takeaways to remember when determining future lease versus buy decisions of this magnitude?

The subject matter of the case is presented as a negotiation between a real estate developer, Hawkins, and a possible anchor tenant, Discount Marketplace. Both parties are represented by professional negotiators: Myra Hart is representing the Hawkins Company and Genia is representing the Discount Marketplace.

3. Summarize the use of Farmout agreements including their purpose and how they help save a lease from termination.

First, based on the vision of the company which is to sell the business and achieving the targeted returns in the long term. Logically, long-term leases allow for long-term financial planning and that depending on the terms of the lease which will also allow the company to calculate the rental expenses over the long-run. Since the interest expenses are increased every year, thus, the company should act towards being highly leveraged. The company forecasted growth rate would

The firm signed a long-term lease with PennState Leasing last year for trucks where one of these trucks will be available for use on the new project in month 1, two for month 2, three for month 3 and one for month 4. The long-term leasing

Welcome back. Last week we looked at underwriting a $250K high yield transaction through the eyes of an independent lessor. Our existing customer, RedBet LLC, had properly paid off two short term leases with us, leaving us a small exposure on a third lease (total exposure had been $320K). RedBet is now coming back to finance of $250K in vacuum tank trailers, a sale that is very important to our preferred vendor. RedBet is an oilfield servicing firm headquartered in New Mexico. We asked, “Would you do this deal? Why or why not?”

Year 1 deals are anticipated at $55,568 taking into account a moderate improvement of the business through catching more customer base each month. I construct these anticipated figures with respect to the inclination to buy a range, putting different components into contemplations, for example, football games on the primary road and having the capacity to get more customer base from my rivals. To ensure that the working capital accessible is reliably adequate in the primary year, the main least sum will be drawn from the business.