Question
CH 24-1 INSTRUCTIONS On October 1, White Way Stores Inc. is considering leasing a building and purchasing the necessary equipment to operate a retail store.
CH 24-1
INSTRUCTIONS
On October 1, White Way Stores Inc. is considering leasing a building and purchasing the necessary equipment to operate a retail store. Alternatively, the company could use the funds to invest in $152,000 of 7% U.S. Treasury bonds that mature in 16 years. The bonds could be purchased at face value. The following data have been assembled:
Labels | |
Cash flows from investing activities | |
Costs | |
Amount Descriptions | |
Costs to operate store | |
Cost of equipment less residual value | |
Gain on sale of investments | |
Income (Loss) | |
Loss on sale of investments | |
Revenues differential analysis A. Prepare a differential analysis as of October 1 presenting the proposed operation of the store for the 16 years (Alternative 1) as compared with investing in U.S. Treasury bonds (Alternative 2). Refer to the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign. If there is no amount or an amount is zero, enter "0". A colon (:) will automatically appear if required.
FINAL
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