subject
Business, 27.07.2020 01:01 MayFlowers

On January 1, 2021, Pharoah, Inc. signs a 10-year noncancelable lease agreement to lease a storage building from Holt Warehouse Company. Collectibility of lease payments is reasonably predictable and no important uncertainties surround the amount of costs yet to be incurred by the lessor. The following information pertains to this lease agreement. (a) The agreement requires equal rental payments at the beginning each year. (b) The fair value of the building on January 1, 2018 is $6200000; however, the book value to Holt is $5150000. (c) The building has an estimated economic life of 10 years, with no residual value. Pharoah depreciates similar buildings using the straight-line method. (d) At the termination of the lease, the title to the building will be transferred to the lessee. (e) Pharoah’s incremental borrowing rate is 12% per year. Holt Warehouse Co. set the annual rental to insure a 11% rate of return. The implicit rate of the lessor is known by Pharoah, Inc. (f) The yearly rental payment includes $15400 of executory costs related to taxes on the property. Click here to view factor tables. What is the annual lease payment excluding executory costs? (Rounded to the nearest dollar.) $328440 $948440 $963840 $933040

ansver
Answers: 3

Another question on Business

question
Business, 22.06.2019 17:00
Afinancing project has an initial cash inflow of $42,000 and cash flows of −$15,600, −$22,200, and −$18,000 for years 1 to 3, respectively. the required rate of return is 13 percent. what is the internal rate of return? should the project be accepted?
Answers: 1
question
Business, 22.06.2019 17:00
Zeta corporation is a manufacturer of sports caps, which require soft fabric. the standards for each cap allow 2.00 yards of soft fabric, at a cost of $2.00 per yard. during the month of january, the company purchased 25,000 yards of soft fabric at $2.10 per yard, to produce 12,000 caps. what is zeta corporation's materials price variance for the month of january?
Answers: 2
question
Business, 22.06.2019 20:50
Stormie zanzibar owns a bakery in the fictitious country of olombia. each month the government’s market ministry mails her a large list of the regulated price of goods which include products like bread, muffins and flat bread. the list also dictates the types of goods she can sell at the bakery and what she is to charge. because of the regulations placed on these goods, stormie has increased her production of sweets, pies, cakes, croissants and buns and decreased her supply of breads, muffins and flat bread. she has taken these steps because the sweet goods’ prices are not government controlled. stormie zanzibar lives under what type of economy?
Answers: 3
question
Business, 22.06.2019 21:10
Ahospital purchases a $500,000 magnetic resonance imaging (mri) machine that has a useful life of 9 years. the salvage value at the end of 9 years is $77,000. (a) write a linear equation that describes the value y (in dollars) of the mri machine in terms of the time t (in years), 0 ≤ t ≤ 9. (b) find the value, in dollars, of the machine after 6 years. $ (c) find the time, in years, when the value of the equipment will be $140,000. (round your answer to two decimal places.) yr
Answers: 2
You know the right answer?
On January 1, 2021, Pharoah, Inc. signs a 10-year noncancelable lease agreement to lease a storage b...
Questions
question
Mathematics, 01.09.2021 23:10
question
Mathematics, 01.09.2021 23:10
question
Mathematics, 01.09.2021 23:10
question
English, 01.09.2021 23:10
question
Mathematics, 01.09.2021 23:10
question
English, 01.09.2021 23:10
question
Mathematics, 01.09.2021 23:10
Questions on the website: 13722365