ESSENTIALS OF INVESTMENTS SELECT CHAPT
17th Edition
ISBN: 9781307126228
Author: Bodie
Publisher: MCG/CREATE
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Chapter 1, Problem 9PS
Lanni Products is u start-.up computer software development firm. It currently owns computer equipment worth $30,000 and has cash on hand of $20,000 contributed by Lanni’s owners. For each of the following transactions, identify the real and/or financial assets that trade hands. Are any financial assets created or destroyed in the transaction? (LO 1-2)
a. Lanni takes out a bank loan. It receives $50,000 in cash and signs a note promising to pay back the loan over three years.
b. Lanni uses the cash from the hank plus $‘20.000 of its own funds to finance the development of new financial planning software.
c. Lanni sells the software product Lo Microsoft, which will market it to the public under the Microsoft name. Lanni accepts payment in the form of 2.000 shares of Microsoft stock.
d. Lanni sells the shares of stock for $70 per share and uses part of the proceeds to pay off the bank loan.
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Lanni Products is a start-up computer software development firm. It currently owns computer equipment worth $31,000 and has cash on hand of $18,000 contributed by Lanni’s owners.
For each of the following transactions, identify the real and/or financial assets that trade hands. Choose one option for following blank: A. real asset. B. financial asset. C. real liability. D. Finanical liability.
The bank loan is a Financial liability for Lanni, and a Financial asset for the bank. The cash Lanni receives is a Financial asset .
1. The new financial asset destroyed or created is Lanni's promissory note to repay the loan.
Lanni uses the cash from the bank plus $18,000 of its own funds to finance the development of new financial planning software.
Lanni transfers financial asset (cash) to the software developers. In return, Lanni receives the completed software package, which is a real asset.
Lanni exchanges the real asset (the software) for a Financial asset, which is 1,400 shares of…
Lanni Products is a start-up computer software development firm. It currently owns computer equipment worth $31,000 and has cash on hand of $18,000 contributed by Lanni’s owners.
For each of the following transactions, identify the real and/or financial assets that trade hands. Choose one option for following blank: A. real asset. B. financial asset. C. real liability. D. Finanical liability.
1. Lanni takes out a bank loan. It receives $48,000 in cash and signs a note promising to pay back the loan over 3 years.
The bank loan is a (select an option) for Lanni, and a (select an option) for the bank. The cash Lanni receives is a (select an option).
2. Lanni uses the cash from the bank plus $18,000 of its own funds to finance the development of new financial planning software.
Lanni transfers (select an option) (cash) to the software developers. In return, Lanni receives the completed software package, which is a (select an option).
3. Lanni sells the software product to Microsoft,…
Lanni Products is a start-up computer software development firm. It currently owns computer equipment worth $21,000 and has cash on hand of $28,000 contributed by Lanni’s owners. Lanni takes out a bank loan. It receives $32,000 in cash and signs a note promising to pay back the loan over 3 years.
a. Prepare the balance sheet just after it gets the bank loan.
assets
liabilities & shareholders' equity
cash ________
bank loan _________
computers ________
shareholders' equity ____________
total ___________
total ________
What is the ratio of real assets to total assets? (Round your answer to 2 decimal places.)
b. Prepare the balance sheet after Lanni spends the $60,000 to develop its software product.
assets
liabilities & shareholders' equity
software product ________
bank loan _________
computers ________
shareholders' equity ____________
total ___________
total ________
What is the ratio of real assets to total assets? (Round your answer to 2 decimal…
Chapter 1 Solutions
ESSENTIALS OF INVESTMENTS SELECT CHAPT
Ch. 1 - Prob. 1PSCh. 1 - Prob. 2PSCh. 1 - Prob. 3PSCh. 1 - Prob. 4PSCh. 1 - Prob. 5PSCh. 1 - Prob. 6PSCh. 1 - For each transaction, identify the real and/or...Ch. 1 - Prob. 8PSCh. 1 - Lanni Products is u start-.up computer software...Ch. 1 - Reconsider Lanni Products from Problem 9. (LO 1-2)...
Ch. 1 - Prob. 11PSCh. 1 - Examine the balance sheet of commercial banks in...Ch. 1 - Prob. 13PSCh. 1 - Prob. 14PSCh. 1 - Prob. 15PSCh. 1 - Prob. 16PSCh. 1 - Why would you expect securitization o take place...Ch. 1 - Prob. 18PSCh. 1 - Give an examp1e of three financial intermediaries,...Ch. 1 - Firms raise capital from investors by issuing...Ch. 1 - The average rate of return on investments in large...Ch. 1 - Prob. 22PSCh. 1 - Prob. 1WMCh. 1 - Prob. 2WMCh. 1 - Prob. 3WMCh. 1 - Prob. 4WM
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