Instructions: See Question $1$ for an example of

how to approach this problem.

Economic Event

BBR entered into an operating lease to open a

new store.

The legal fees paid in cash to acquire the lease

were $$75.$

The present value of the future lease obligation

is $$2,200$ excluding the initial payment of $$275$

paid in cash at the beginning of the lease. $($Ignore

any current portion of the lease obligation.$)$

Record this economic event.

Questions:

Blank $1-$ The current ratio was $992$ before the

economic event. What is the current ratio after

this event?

Blank $2-$ How has solvency changed after this

economic event? Is there an increase, decrease,

or no effect on solvency?

Blank $3-$ The profit margin was $6\mathrm{.}6\%$ before this

economic event. What is the profit margin

immediately after this event?