Question
Company A started at the beginning of 2019. They entered into a lease with Jan 1st as both inception and commenment date. The Lease term
Company A started at the beginning of 2019.
They entered into a lease with Jan 1st as both inception and commenment date.
The Lease term is as below:
- 5 yr non-cancellable
- 5% interest rate
- equal payment of $22916.51 at the end of each year.
- $1,000 bargaining purchase option at the end of lease term.
Useful life of this asset is 6 years with 0 residual value.
Tax rate 25%.
Earnings before interest, amortization and taxes is below.
2019: $123,456
Balance Sheet is below.
Year 2019:
Current Assets
Cash: ?
Accounts Receivable: 120000
Prepaid Expenses: 8000
Future Tax Asset: ?
Long-term Asset: ?
Total Assets: ?
Current Liabilities
Accounts Payable: 100000
Unearned Revenue: 10000
Future Tax Liabilities: ?
Long-term Liabilities: ?
Total Liability: ?
Shareholders' Equity
Retained Earnings: ?
Common Equity: 200000
Total Shareholders' Equity: ?
Total Liability and Equity: ?
Question: What are the values of the question marks?
Please explain step by step.
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