Business, 06.12.2021 17:20 tmax8437

On January 1, 2021, Oriole, 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, 2021 is $5550000; however, the book value to Holt is $4500000.
(c) The building has an estimated economic life of 10 years, with no residual value. Oriole 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) Oriole's incremental borrowing rate is 12% per year. Holt Warehouse Co. set the annual rental to insure a 10% rate of return. The implicit rate of the lessor is known by Oriole, Inc.
(f) The yearly rental payment includes $14100 of executory costs related to taxes on the property.
Future Value of Ordinary Annuity of 1
Period 5% 6% 8% 10% 12%
1 1.00000 1.00000 1.00000 1.00000 1.00000
2 2.05000 2.06000 2.08000 2.10000 2.12000
3 3.15250 3.18360 3.24640 3.31000 3.37440
4 4.31013 4.37462 4.50611 4.64100 4.77933
5 5.52563 5.63709 5.86660 6.10510 6.35285
6 6.80191 6.97532 7.33592 7.71561 8.11519
7 8.14201 8.39384 8.92280 9.48717 10.08901
8 9.54911 9.89747 10.63663 11.43589 12.29969
9 11.02656 11.49132 12.48756 13.57948 14.77566
10 12.57789 13.18079 14.48656 15.93743 17.54874
Present Value of an Annuity Due of 1
Period 5% 6% 8% 10% 12%
1 1.00000 1.00000 1.00000 1.00000 1.00000
2 1.95238 1.94340 1.92593 1.90909 1.89286
3 2.85941 2.83339 2.78326 2.73554 2.69005
4 3.72325 3.67301 3.57710 3.48685 3.40183
5 4.54595 4.46511 4.31213 4.16986 4.03735
6 5.32948 5.21236 4.99271 4.79079 4.60478
7 6.07569 5.91732 5.62288 5.35526 5.11141
8 6.78637 6.58238 6.20637 5.86842 5.56376
9 7.46321 7.20979 6.74664 6.33493 5.96764
10 8.10782 7.80169 7.24689 6.75902 6.32825
Oriole, Inc. would record amortization expense on this asset in 2021 of.

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answer; blank (1) hrm specialists,blank(2); line managers;

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answercountries with higher real income per capita tend to have higher levels of this index.

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of the three mortgage options that demarco and tanya have to choose from, the balloon payment mortgage would be their best option, over adjustable payment and fixed payment plans.ultimately, the balloon payment plan would save demarco and tanya overall, in interest, would cost less monthly, and they would only have to make these payments for 8 years, opposing to 30 years for adjustable or fixed payment plans.

overall, demarco and tanya would save $80,811 if they chose balloon payments over fixed payments, and would save $116,711 if they choose balloon payments over adjustable payments. benefits with choosing fixed payments over adjustable payments is that, in the end, the payments will still be $836.30 a month, while with adjustable payments, the initial monthly payments will be $763.38 to $1082.70 a month, ultimately leading to a more costly purchase. benefits with choosing fixed payments over balloon payments are not present. benefits in choosing adjustable payments over is that it has a lower interest rate, and starts with lower monthly payments initially. benefits in choosing adjustable payments over balloon payments include a lower interest rate, and lower initial monthly payments. benefits in choosing balloon payments over fixed payments include lower interest rates, lower overall price, lower monthly payments, takes less time to pay off, and does not require a downpayment. benefits in choosing balloon payments over adjustable payments include, lower monthly payments (when averaged), takes less time to pay off, and lower overall price.

hence, option c, balloon payments, is the best option for demarco and tanya to make this purchase, for it will save them a minimum of $80811, and a maximum of $116,711.

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Answera market responds to a product over time;

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On January 1, 2021, Oriole, Inc. signs a 10-year noncancelable lease agreement to lease a storage bu...

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