Sheridan Corporation bought a new machine and agreed to pay for it in equal annual installments of the next 10 years. Assuming that a prevailing interest rate of 8% applies to this contract, how much should Sheridan record as the cost of the machine? (Round factor values to 5 decimal places, e.g. 1.25124 and final answer to 0 decimal places, e.g. 458,581.) Cost of the machine to be recorded $
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- On August 1, 2019, Kern Company leased a machine to Day Company for a 6-year period requiring payments of 10,000 at the beginning of each year. The machine cost 40,000 and has a useful life of 8 years with no residual value. Kerns implicit interest rate is 10%, and present value factors are as follows: Present value for an annuity due of 1 at 10% for 6 periods4.791 Present value for an annuity due of 1 at 10% for 8 periods5.868 Kern appropriately recorded the lease as a sales-type lease. At the inception of the lease, the Lease Receivable account balance should be: a. 60,000 b. 58,680 c. 48,000 d. 47,910Using the information provided, what transaction represents the best application of the present value of an annuity due of $1? A. Falcon Products leases an office building for 8 years with annual lease payments of $100,000 to be made at the beginning of each year. B. Compass, Inc., signs a note of $32,000, which requires the company to pay back the principal plus interest in four years. C. Bahwat Company plans to deposit a lump sum of $100.000 for the construction of a solar farm In 4 years. D. NYC Industries leases a car for 4 yearly annual lease payments of $12,000, where payments are made at the end of each year.Pearl Corporation bought a new machine and agreed to pay for it in equal annual installments of $4,150 at the end of each of the next 10 years. Assuming that a prevailing interest rate of 8% applies to this contract, how much should Pearl record as the cost of the machine?
- Manatee Corporation bought new equipment and agreed to pay for it in five equal annual installments of $10,000 beginning at the end of next year. Assuming that a prevailing interest rate of 10% applies to this contract, how much should Manatee record as the cost of the equipment?03) In order to replace a present facility, a company is to deposit $11000 at the end of every year at an interest rate of 8 % compounded annually. Find: a. The future total amount that will be available for the company after 10 years to purchase the new facility. b. The total amount (initial+ interest amount) at the end of each year until the last year of deposition.9. A granite company is planning to buy a fully automated granite cutting machine. If it is purchased under down payment, the cost of the machine is ETB 16,00,000. If it is purchased under installment basis, the company has to pay 25% of the cost at the time of purchase and the remaining amount in 10 annual equal installments of ETB 2,00,000 each. Suggest the best alternative for the company using the present worth basis at i = 18%, compounded annually.
- On February 5, 2020, Diamond Company purchased a new machine on a deferred payment basis. A down payment of P100,000 and P250,000 four equal annual installments will be made every February 1, starting next February 1, 2021. The cash equivalent price of the machine is P950,000. The imputed discount rate is 6.83%. Diamond also incurred P30,000 in installation costs. How much should be capitalized as cost of the machine? O 1,100,000 900.000 O950.000 O980.000Crane Excavating Inc. is purchasing a bulldozer. The equipment has a price of $103,000. The manufacturer has offered a payment plan that would allow Crane to make 10 equal annual payments of $18,229.37, with the first payment due one year after the purchase. (a) How much total interest will Crane pay on this payment plan? (Round answer to 0 decimal places, e.g. 458,581.) Total interestTeari Company purchased a machine on September 1, 2021. The purchase agreement required Teari to pay an initial fee payment of P700,000 plus four P300,000 payments due every four (4) months, the first payment due December 31, 2021. The market interest rate is 12%. The present and future value tables at 4% for four (4) periods were as follows: Present value of P 1, 0.85; Present value of an ordinary annuity of P1, 3.63; Future value of P 1, 1.17, Future value of an ordinary annuity of P1, 4.25. What is the fair value of the note on December 31, 2021.
- American Food Services, Inc., acquired a packaging machine from Barton and Barton Corporation. Barton and Barton completed construction of the machine on January 1, 2021. In payment for the $4.5 million machine, American Food Services issued a four-year installment note to be paid in four equal payments at the end of each year. The payments include interest at the rate of 10%. (FV of $1 PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Prepare the journal entry for American Food Services' purchase of the machine on January 1, 2021. 2. Prepare an amortization schedule for the four-year term of the installment note. 3. Prepare the journal entry for the first installment payment on December 31, 2021. 4. Prepare the journal entry for the third installment payment on December 31, 2023. Complete this question by entering your answers in the tabs below. Req 2 X Answer is not complete. Req 1 3 and 4A fully automatic chucker and bar machineis to be purchased for $45,000. The money will beborrowed with the stipulation that it be repaid withsix equal end-of-year payments at 12% compoundedannually. The machine is expected to provide annualrevenue of $13,000 for six years and is to be depreciated by the MACRS seven-year recovery period. Thesalvage value at the end of six years is expected tobe $4,000. Assume a marginal tax rate of 35% and aMARR of 15%.(a) Determine the after-tax cash flow for this assetover six years.(b) Determine whether the project is acceptable onthe basis of the IRR criterion.Grummet Company is acquiring a new wood lathe with a cash purchase price of $80,000. The Wood Master Industries (the manufacturer) has agreed to accept $23,500 at the end of each of the next 4 years. Based on this deal, how much interest will Grummet pay over the life of the loan?A. $94,000B. $80,000C. $23,500D. $14,000