Risk management is an organized strategy for protecting assets and people and is considered a ____

On June 30, 2021, Georgia-Atlantic, Inc. leased a warehouse equipment from IC Leasing Corporation. The lease agreement calls for

Mars2501 [29]

Answer:

1. $3,799,988

2. $3,419,989

Explanation:

1. Semiannual lease payment = $468,683

Total semiannual payments = 5*2 = 10

Incremental borrowing rate = 10%, 5% semiannual

Present value of minimum lease payments used to record right to use assets = Semi Annual lease payments * Cumulative PV Factor of annuity due for 10 periods at 5%

= $468,683 * 8.1078 = $3,799,988.0274 ≈ $3,799,988

2. Semiannual payment on 30.06.2021 = $468,683

Pretax amount of liability on 30.06.2021 = ($ 3,799,988.0274 - $468,683) = $3,331,305.0274

Interest expense for 31.12.2021 = $3,331,305.0274 * 5% = $166,565.25137

Semiannual lease payment on 31.12.2021 = $468,683

Pre tax amount for liability December 31, 2021 = $3,331,305.0274 + $166,565.25137 - $468,683 = $3,029,187.2788

Depreciation on right to use assets for 2021 = ($3,799,988.0274 ÷ 5) * (5/10)= $379,998.80274

Pre tax amount of right to use asset to be reported for 2021 = $3,799,988.0274 - $379,998.80274 = $3,419,989.2247 ≈ $3,419,989

5 0

2 years ago

When we express the value of a cash flow or series of cash flows in terms of dollars today, we call it the ________ of the inves

vekshin1

Answer:

Present value

Future value

Explanation:

Present value is the value of cashflows discounted at interest rate at arrive at its value today.

Future value is the value of cashflows discounted at interest rate at arrive at its value at some given time in the future.

I hope my answer helps you

8 0

2 years ago

Read 2 more answers

Consider the following cash flow of company profits. A company earns $3600 in years 1, 2, & 3, from years 4 through 7 the pr

stellarik [79]

Answer:

The present worth of cash flow is $22395.51

Explanation:

In this type of question we have two parts of the question the first part we are going to get the present value of it which is when the company earns $3600 for the first 3 years with an interest rate of 9%, so we will use the present value annuity formula as the company is earning future cash flows of a present amount that is agreed upon. The present value annuity formula which is Pv1 = C[(1-(1+i)^-n )/i) where:

Pv1 is the present value of the cash flows for three years.

C is the annual cash flows for 3 years which is $3600.

i is the interest rate on the cash flows which is 9%

n is the number of years in which the cash flows took which is 3 years.

Now we will substitute this into the above mentioned formula to get the present value of the cash flows that the company gets for the first 3 years:

Pv1 = $3600[(1-(1+9%)^-3)/9%]

Pv1 =$9112.66

Now we will deal with getting the present value of the remaining 4 years in which the profits increased by $500 therefore the cash flows increased to $4100 for the remaining 4 years of the total 7 years of the cash flows. We will use the present value annuity formula that we used above for the first three years which we will substitute as follows:

Pv2 is the present value of the 4 years cash flow.

C is the cash flows of profits which is $4100

i is the interest rate of 9%

n is the remaining number of years remaining which is 4 years.

now we substitute:

Pv2 = $4100[(1-(1+9%)^-4)/9%]

Pv2 = $13282.85

now to get the total present value of the profits we will combine both present values to get the present value of the profits in 7 years:

Present value for 7 years cash flows = Pv1 + Pv2

= $9112.66 + $13282.85

=$22395.51

6 0

2 years ago

Absorption and Variable Costing Comparisons: Production Equals Sales Assume that Smuckers manufactures and sells 30,000 cases of

pantera1 [17]

Answer:

a:Total Variable Costs $26

a:Total Manufacturing Costs = $ 30

b:Net Income Variable Costing $100,000

b: Net Income Absorption Costing $ 100,000

Explanation:

Smuckers Manufacturers

Costs per case under Variable Costing

Direct materials per case 16

Direct labor per case 7

Variable manufacturing overhead per case 3

Total Variable Costs $26

Costs per case under Absorption Costing

Direct materials (30,000*16) 480,000

Direct labor (30,000*7) 210,000

Variable manufacturing overhead (30,000*3) 90,000

Total Variable Costs 780,000

Total fixed manufacturing overhead $120,000

Total Manufacturing Costs $ 900,000

Total Manufacturing Costs per Case= $ 900,000/ 30,000= $ 30

The difference between the variable and absorption costing is that the product costs include variable and fixed costs in absorption costing. But in variable costing the product costs include only variable costs.

SMUCKERS

Variable Costing Income Statement

For the Third Quarter of 2017

Sales (30,000*34) 1020,000

Direct materials (30,000*16) 480,000

Direct labor (30,000*7) 210,000

Variable manufacturing overhead (30,000*3) 90,000

Total Variable Costs 780,000

Contribution Margin 240,000

Fixed Expenses 140,000

Total fixed manufacturing overhead $120,000

Fixed selling and administrative 20,000

Net Income 100,000

In this case the net income under both variable and absorption costing does not change because the units produced are units sold. No cost is charged to ending inventory under absorption costing.

SMUCKERS

Absorption Costing Income Statement

For the Third Quarter of 2017

Sales (30,000*34) 1020,000

Direct materials (30,000*16) 480,000

Direct labor (30,000*7) 210,000

Variable manufacturing overhead (30,000*3) 90,000

Total fixed manufacturing overhead $120,000

Total Manufacturing Costs 900,000

Gross Profit 120,000

Fixed Expenses 20,000

Fixed selling and administrative 20,000

Net Income 100,000

3 0

2 years ago

A company like Motorola might establish a goal of reducing its inventory by 50 percent over the next year. To ensure that it rea

KengaRu [80]

Answer: e.controlling

Explanation:

Controlling is one of the functions of a manager. It entails ensuring that an organisation is still on track to achieve set out objectives and making necessary corrections if it isn't.

Other functions of a manager includes-

a.Planning - it involves the development of an organisation's goals. it involves strategizing on how to achieve goals set out by the organisation.

b.Directing - it involves putting patterns, resocurces in place to ensure goals are achieved.

c.Leading - it involves encouraging, correcting and assisting members of staffs in achieving organisation's goals.

4 0

2 years ago

Risk management is an organized strategy for protecting assets and people and is considered a _____.