Straight Industries purchased a large piece of equipment from Curvy Company on January 1, 2019. Straight Industries signed a note, agreeing to pay Curvy Company $360,000 for the equipment on December 31, 2021. The market rate of interest for similar notes was 9%. The present value of $360,000 discounted at 9% for five years was $233,975. On January 1, 2019, Straight Industries recorded the purchase with a debit to equipment for $233,975 and a credit to notes payable for $233,975. On December 31, 2019, Straight recorded an adjusting entry to account for interest that had accrued on the note. Assuming no adjusting entries have been made during the year, the interest expense accrued at December 31, 2019 is closest to:

• $30,093.

• $21,058.

• $27,893.

• $32,400.

Lauer Corporation has provided the following information about one of its laptop computers:

Date	Transaction	Number of Units	Cost per Unit
1/1	Beginning Inventory	140	$	840
5/5	Purchase	240	$	940
8/10	Purchase	340	$	1,040
10/15	Purchase	220	$	1,090

During the year, Lauer sold 850 laptop computers. What was ending inventory using the FIFO cost flow assumption?

• $75,600.

• $97,600.

• $95,600.

• $98,100.

Rae Company purchased a new vehicle by paying $10,500 cash on the purchase date and agreed to pay $3,500 every three months during the next five years. The first payment is due three months after the purchase date. Rae's incremental borrowing rate is 12%. The liability reported on the balance sheet as of the purchase date, after the initial $10,500 payment was made, is closest to: (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided.)

• $70,000.

• $52,071.

• $80,500.

• $62,571.

Warren Company plans to depreciate a new building using the double declining-balance depreciation method. The building cost is $850,000. The estimated residual value of the building is $55,000 and it has an expected useful life of 20 years. Assuming the first year's depreciation expense was recorded properly, what would be the amount of depreciation expense for the second year?

Multiple Choice

• $85,000.

• $42,500.

• $76,500.

• $47,890.