Erdman Corp. signs a lease to rent equipment for ten years. The lease payments of $20,000 per year are due on January 2 each year. At the end of the lease term, Erdman may purchase the equipment for $500. The equipment is estimated to have a useful life of 10 years. Erdman prepares its financial statements in accordance with IFRS. Erdman should classify this lease as a(n):
Answers
Erdman Corp. should classify this lease as a finance lease.
Under International Financial Reporting Standards (IFRS), leases are classified as either finance leases or operating leases. Finance leases are characterized by transferring substantially all the risks and rewards incidental to ownership of the leased asset to the lessee.In this case, Erdman Corp. is making lease payments over a period of ten years and has the option to purchase the equipment at the end of the lease term for a nominal amount. The lease payments and the purchase option indicate that Erdman Corp. will effectively take on the ownership and the risks associated with the equipment.Since the lease transfers the significant risks and rewards of ownership to Erdman Corp., it should be classified as a finance lease under IFRS. This means that Erdman Corp. would recognize the leased equipment as an asset and a corresponding liability on its balance sheet. The lease payments would be allocated between interest expense and reducing the lease liability over the term of the lease.It's important to note that the classification of leases may vary under different accounting frameworks, such as Generally Accepted Accounting Principles (GAAP). Therefore, it's essential for Erdman Corp. to adhere to the specific accounting standards and guidelines applicable to their reporting requirements.
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Related Questions
Assume a stock has a value of $100. The stock is expected to pay a dividend of $2 per share at year-end. An at-the-money European-style put option with one-year maturity sells for $7. If the annual interest rate is 5%, what must be the price of a 1-year at-the-money European call option on the stock? (Round your answer to 2 decimal places.)
Answers
the price of the 1-year at-the-money European call option on the stock must be $11.76.
To solve this problem, we can use the put-call parity formula:
C + PV(X) = P + S
where C is the price of the call option, PV(X) is the present value of the strike price, P is the price of the put option, and S is the current stock price.
Since the put option is at-the-money, the strike price X is equal to the current stock price S, which is $100. Also, the present value of the strike price PV(X) can be calculated as:
PV(X) = X / (1 + r)^t
where r is the annual interest rate, t is the time to maturity in years, and X is the strike price. Substituting the values given, we get:
PV(X) = 100 / (1 + 0.05)^1 = 95.24
Substituting all the values into the put-call parity formula and solving for C, we get:
C = P + S - PV(X) = 7 + 100 - 95.24 = 11.76
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Risk _____ is the identification, analysis, and evaluation of risk as initial parts of risk management.
Answers
Risk protection exists the identification, analysis, and evaluation of risk as initial parts of risk management.
What is Risk protection in risk management?The process of discovering, evaluating, and controlling risks to an organization's resources and profits is known as risk management. These dangers can be caused by a number of things, such as monetary unpredictability, legal responsibilities, technological problems, strategic management blunders, accidents, and natural calamities.
A company cannot specify its long-term goals without a strong risk management strategy. Risk management, arguably one of the most crucial elements of an organization, is what safeguards it against losses and, at the same time, allows it to seize possibilities.
A tried-and-true method for locating and evaluating elements that can adversely affect a project's or company' success is risk analysis. It enables you to evaluate the risks that you or your company face and aids in your decision-making process.
Hence, Risk protection exists the identification, analysis, and evaluation of risk as initial parts of risk management.
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Suppose you worked in the government. A company wants to set up a factory in your country. It would bring jobs, but it would also bring about pollution, which would lead to acid rain. Would you allow it?
Answers
Hiring managers spend at least an hour reviewing an applicants résumé.
A. True
B. False
Answers
Answer: False?
Explanation:
Hiring managers spend often 30 sec to 2 minutes reviewing an applicants resume.
What about this profile would most appeal to a recruiter from a public relations firm? Check all that apply. the username the biography the favorite quote the most recent post the number of followers
Answers
Answer:
B. the biography
D. the most recent post
E. the number of followers
Explanation:
Correct on ED2022! Good Luck! <3
The items on a profile that appeal to recruiters are he biography the favorite quote the most recent post the number of followers.
What is meant by the term Profile?In recent times social media has drifted processes from tradition to digital, the term profile is used to describe the information of a user.
Recruitment officers now utilise this feature to source for talent by reading up about a prospective employee and engaging with them virtually.
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When estimating depreciation of an improvement, which age will the appraiser use? (a) Actual age O (b) Effective age O (C) Chronological age O (d) Economic age
Answers
When estimating depreciation of an improvement, Actual age will the appraiser use.
What is depreciation?
The financial value of an asset decreases over time due to use, wear and tear or fustiness. This drop is measured as deprecation. Description deprecation, i.e. a drop in an asset's value, may be caused by a number of other factors as well similar as inimical request conditions, etc. deprecation is appertained to as the reduction in the cost of a fixed asset in successional order, due to wear and tear until the asset becomes obsolete. Machinery, vehicle, outfit, and structure are some exemplifications of means that are likely to witness wear and tear and gash or fustiness. deprecation is from the Latin word depretiare, which means to lower in price, with the roots de, meaning" down," and pretium, meaning" price." If commodity goes down in value, also the quantum of the drop is called deprecation.
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1. One advantage of sole proprietorship is:
A. -easing of starting.
B -availability of different talents.
C -unlimited life of the company.
D -double taxation
Answers
Select the correct answer from each drop-down menu.
What does a personal budget do?
A personal budget provides a ( salary slip, detailed account, summary)
of income and expenses for a (monthly,given,yearly)
period.
Answers
Answer:
A personal budget provides a detailed account of income and expenses for a period.
Explanation:
A personal budget is a plan of how one intends to spend their income. It shows the source of income and the total on one side. The expenses are listed on a different side. Each expenditure item is listed and its estimated amount is indicated. The total of all incomes and expenses is shown on their respective sides.
A personal budget may be prepared for a regular income say monthly, weekly, or quarterly payments. It can also be prepared for irregular incomes such as loans, gifts, or bonuses.
Answer:
A personal budget provides a Summary of income and expenses for a
Given period
Explanation:
got it right on the test for edmentum.
When making decisions, managers often must decide between doing what is beneficial for the firm in the short term, and what is beneficial for both the firm and society in the long term. To address this conflict, a firm must
Answers
When making decisions, managers are often faced with a conflict between what is beneficial for the firm in the short-term and what is beneficial for both the firm and society in the long-term.
This conflict arises because the actions that benefit the firm in the short-term may not necessarily align with the interests of society as a whole, which can lead to negative consequences for both the company and society in the long-term.
To address this conflict, a firm must adopt a long-term orientation and consider the broader social and environmental impacts of its decisions. This means looking beyond immediate financial gains and recognizing that actions taken today can have far-reaching implications for the company's reputation, customer loyalty, employee morale, and overall sustainability.
Firms that prioritize social responsibility and sustainable business practices are more likely to build strong relationships with stakeholders, including customers, employees, investors, and regulators. They are also better equipped to weather economic downturns and other disruptions, as they have diversified their risk and invested in building resilient supply chains and communities.
Ultimately, the key to addressing the conflict between short-term gains and long-term benefits is a commitment to corporate social responsibility (CSR) and sustainable business practices. By prioritizing the needs of society and the environment alongside those of shareholders, firms can create value for all stakeholders over the long-term, ensuring their continued success and impact.
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the following balance sheet information was provided by o'connor company: assetsyear 2 year 1 cash$4,000 $2,000 accounts receivable 15,000 12,000 inventory$35,000 $38,000 assuming that net credit sales for year 2 totaled $270,000, what is the company's most recent accounts receivable turnover?
Answers
Accounts receivable turnover = Net credit sales ÷ [(Beginning accounts receivable + ending accounts receivable) ÷ 2]
Accounts receivable turnover = $270,000 ÷ [($12,000 + $15,000) ÷ 2] = $270,000 ÷ $13,500 = 20 times
What is the company's turnover rate for accounts receivable?The accounts receivable turnover ratio is a financial indicator that shows how effectively a business collecs receivables from its customers. The ratio counts the number of times throughout a certain time frame that receivables are converted to cash.
One way to determine accounts receivable turnover (A/R) is to divide net credit sales (CR) by average accounts receivables (AR). Average Accounts Receivable is calculated by dividing the beginning and ending totals of all Accounts Receivable over a specific period of time (such as quarterly or monthly), by two.
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EMI is inversely related to down payment \& tenure of the loan; and directly related to the rate of interest. Explain this statement with the help of a suitable example. Present all the required calculations.
Answers
The EMI is directly related to the rate of interest, which means that if the interest rate increases, the EMI will also increase.
EMI or equated monthly installment is the fixed payment made by the borrower to the lender, typically on a monthly basis, for a fixed period of time until the loan is repaid completely. The EMI is directly proportional to the loan amount and the interest rate charged on the loan. However, it is inversely related to the down payment and the tenure of the loan. This means that if the down payment or the tenure of the loan increases, the EMI decreases and vice versa. Additionally, the EMI is directly related to the rate of interest, which means that as the interest rate increases, the EMI also increases.
Let's consider an example to understand the relationship between EMI, down payment, tenure, and rate of interest.Suppose you want to take a loan of Rs. 5 lakhs at an interest rate of 10% per annum for a period of 5 years. The bank offers you two options:Option 1: Down payment of Rs. 50,000 and EMI for 5 yearsOption 2: Down payment of Rs. 1,00,000 and EMI for 4 years.In both options, the total loan amount is Rs. 4.5 lakhs. However, the down payment and tenure of the loan are different.Using the EMI formula, we can calculate the EMI for both options.EMI = [P x R x (1+R)^N] / [(1+R)^N-1]where,P = Loan amountR = Interest rate per monthN = Number of monthsOption 1: P = Rs. 4.5 lakhs, R = 10%/12, N = 5 x 12 = 60EMI = [450000 x (10/12) x (1+10/12)^60] / [(1+10/12)^60-1]= Rs. 9,688Option 2: P = Rs. 4.5 lakhs, R = 10%/12, N = 4 x 12 = 48EMI = [450000 x (10/12) x (1+10/12)^48] / [(1+10/12)^48-1]= Rs. 11,143Therefore, we can see that the EMI for option 1 is less than that of option 2. This is because the down payment is more and the tenure of the loan is longer in option 1, which reduces the EMI. However, the EMI is directly related to the rate of interest, which means that if the interest rate increases, the EMI will also increase.
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According to Marx, one of the ways a factory owner (the owner of the means of production) would control his or her workers (the propertyless) would be through religion. This was done by:
Answers
According to Marx, the factory owner would control his or her workers through religion by using it as a means of social control. Marx believed that religion was used to justify the oppressive social and economic conditions in which the working class found themselves.
For example, religion was used to instill in the workers the belief that their suffering was a result of divine punishment for their sins or as a test of their faith. This helped to maintain the status quo and prevented workers from questioning their situation or seeking to change it. Furthermore, religion was used to promote obedience and passivity among the workers. The promise of reward in the afterlife was used to discourage workers from seeking change in this life. This, in turn, helped to maintain the power and control of the factory owner over the workers.
In essence, Marx saw religion as a tool that was used by the ruling class to maintain their power and control over the working class. By promoting the belief in a divine order, the ruling class was able to convince the working class that their suffering was part of a larger plan and that their place in society was predetermined. This prevented the workers from seeking change or questioning their position in society.
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If inspections and licenses are required, then the role of government being represented is a ______.
Answers
Answer:
"Supervisory body" is the right approach.
Explanation:
A case investigator who usually reviews lawsuits regarding businesses and governments is considered a Supervisory body.It would be the independent central parliamentary entity responsible for the supervision of law enforcement records audit, the passenger details unit as well as the Federal or state authorities service Inspectorate.Answer:
If inspections and licenses are required, then the role of government being represented is a supervisory body.
Explanation:
Edge 2021-2022
What does the term 'user
experience' refer to regarding a
website?
A. the overall ease of navigation and ability to
purchase on a company's website
B. the general experience a customer has when
using a product of a business
C. the customer experience when dealing with
customer service representatives
Answers
Answer:b
Explanation:
Net Purchases + Purchases Returns and Allowances + Purchase Discounts equals:
O A. Gross Profit.
OB. Gross Purchases.
O C. Net Income.
OD. Net Loss.
Answers
Answer:
OB. Gross Purchases.
Explanation:
Gross purchases represent all the purchases a business made in a particular period. It includes returns outwards ( purchases returns), discounts and allowances received.
Net purchases are calculated by subtracting purchase returns, discounts received, and allowances from gross purchases.
Therefore, Net Purchases + Purchases Returns and Allowances + Purchase Discounts= gross purchases.
According to Nobel economist Frederich von Hayek, law that secures __________ rights in modern society is a prerequisite to private enterprise. Multiple Choice corporate civil property individual
Answers
The rights which Nobel economist Friedrich von Hayek, law that secures and was a prerequisite to private enterprise is
Property RightsWhat is Property Rights?This refers to the inalienable rights which a property owner has as to how he chooses to rent, lease, let or sell his property or live there.
With this in mind, we can see that the main thing which Friedrich von Hayek believed was a prerequisite to private enterprise was property rights.
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What are the subsidiaries of ViacomCBS?
Answers
Answer:
These are the subsidiaries of ViacomCBS :
Paramount Pictures InternationalParamount Licensing, IncShowtime NetworksNickelodeonMTVComedy CentralBETCBS All AccessPluto TV Simon & Schusterand more......
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write the short note on durable and non durable materials
Answers
Select the correct answer.
Angela meets with a new couple to determine their needs for a new home and how large a home they can afford
Answers
Answer:
c is the answer to the question
Explanation:
If my answer is incorrect, pls correct me!
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Holy macaroni! That's Almost It!
We're done with the four habits of millionaires-to-be.
Do you remember what the habits were? Let's see...
Check the sentences that best describe the "Big Four
Habits."
And you'll see this question again in the test
. You're not quite there yet. Try again.
Virtually all of the 7 million millionaires in the United States
never had to think about tomorrow, since they knew they would be
rich.
were always thinking ahead.
wanted their money to work for them.
wanted to store their money under the bed.
were looking forward to buying a lot of nice toys.
assumed all sellers were telling the truth.
learned how to make smart decisions by doing their homework.
always paid their cell phone first.
always paid themselves first.
Answers
Answer:
2,3,7 and the last one
Explanation:
Just had the same question and went back into the lesson to look . THESE TAKE FOREVER HAHA
Seven million millionaires in U.S :
we're always thinking ahead.wanted their money to work for them.learned how to make smart decisions always paid themselves first.Who are millionaires?Millionaires are those individuals who have a net worth that is equal to or are then one million units of currency.
These people include businessmen that have own business and own large amount of shares in other companies. The millionaires networth and financial assets also contribute to the nation's GDP.
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if you are looking for a vacation near Deep Creek Lake, MD then check this out. its really nice :)
Answers
Which of the following characteristics of tourism services explains which guests need to be present when the service is being performed?
Answers
A postoperative client is being evaluated for discharge and currently has an Aldrete score of 8. Which of the following is the most likely outcome for this client
Answers
Body temperature should be measured on admission and four hourly with other vital signs unless clinically indicated for further frequent measures.
Maintaining rotation and assessing for cardiac complications in the immediate post-op period is precedence for nursing care. The Valsalva initiative produces pressure on abdominal injuries, which increases the threat of evisceration. The nanny minds a customer who develops an evisceration. The client can be discharged from the PACU.
The primary nursing thing in the immediate postoperative period is conserving pulmonary function and forestallment of Hypoxemia and hypercapnia. A post-op period reports severe abdominal pain. The nanny can not auscultate bowel sounds and notes the customer's tummy is rigid.
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What is one benefit US workers who have a college degree rather than a high school diploma?
Answers
Answer:
Those with a college degree earn nearly twice as much as those without college.
Explanation:
A college degree increases the chances of securing a higher paying job than a high school diploma. Most employers insist on college degrees for managerial or executive positions. These are the positions with good pay packages. Currently, college graduates earn nearly twice their high school diploma holders.
Answer:
D.
Explanation:
the person above me is correct
Identifying Job Application Tools
What document is used to summarize a job applicant's experience, education, and achievements?
O test score
O school transcript
O review letter
O resume
Answers
Answer:
Resume
I hope this helps! Have a good life! ✌Answer:
D - resume
Explanation:
got it correct on edge
True or False: according to our lecture, doing research into industry trends is one way for a professional sales representative to position his/herself as an "equal" in a sales meeting
Answers
How does a project manager evaluate the scope of a project?
Determine the overall work that needs to be completed to deliver the desired product, service, or end result
Estimate some of the resources that are needed to deliver the desired product, service, or end result
Evaluate the time it will take to deliver the desired product, service, or end result
Guess how much money it will cost to deliver the desired product, service, or end result
Answers
Stating in an answer for future reference, it's A, "Determine the overall work that needs to be completed to deliver the desired product, service, or end result".
No "Tutor" needed.
why has communism not been a successful economic system?
Answers
Answer:
because the goverment controls everything
Explanation:
who are the main stakeholders in china merchants group’s acquisition of the newcastle port and what are their key interests and concerns in this acquisition?
Answers
The corporation, owners, workers, clients, and the local government might all be major stakeholders in China Merchants Group's purchase of Newcastle port.
Shareholders, staff, clients, and the Australian government are among the key parties involved in China Merchants Group's purchase of Newcastle port.
The purchase of a port in a prime location is one of China Merchants Group's primary goals as it advances both the company's global reach and logistical capabilities. Also, the purchase could provide the business access to new markets and clients.
The Australian government and the neighborhood's top priorities include preserving the port's status as a significant economic hub and making sure that all shipping firms may access it. Concerns about the environment and potential effects on nearby jobs might also exist. The financial ramifications of the transaction can be of interest to shareholders and staff.
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Julian buys plants and flowers every month. Both are normal goods. When the price of flowers fell, Julian purchased fewer plants. Which of the following statements is true for Julian regarding the income effect and the substitution effect
Answers
When the price of flowers fell, Julian purchased fewer plants. Julian regarding Substitution effect was stronger.
What is the Substitution Effect ?Substitution Effect is the change in the quantity of a good that a consumer demands when the good's price rises, holding other prices and the consumer's utility constant.
The substitution effect happens when consumers replace cheaper items with more expensive ones due to price changes or when their financial conditions improve, and vice-versa.
The substitution effect (SE) is derived from a product's price variation, together with the income effect (IE).
If the price of a product rises, demand of the product decreases (law of demand) because consumers will switch and demand a substitute good instead, as such goods would allow them to satisfy the same individual need of preference (that is the ultimate objective when making a purchase).
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