TABLE 7A-4 PRESENT VALUE OF 1

8%9%10%11%12%15%(N) PERIOD.92593.91743.90909.90090.89286.869571

.85734.84168.82645.81162.79719.756142.79383.72218.75132.73119.71178.657523.73503.70843.68301.65873.63552.571754.68058.64993.62092.59345.56743.497185TABLE 7A.5 PR ESENT VALUE OF AN ORDINARY ANUITY OF 1

8%9%10%11%12%15%(N) PERIOD.92593.91743.90909.90090.89286.8695711.783261.759111.735541.712521.690051.6257122.577102.531302.486852.443712.401832.2832333.312133.239723.169863.102453.037352.8549843.992713.889653.790793.695903.604783.352165Lebron kozlowski, owner of the King Enterprises, is a college classmate of Elon Musk. Musk is the founder and chief architect of Tesla Motors (maker of the first electric luxury sports car), and CEO and CTO of Space X and Chairman of SolarCity. Lebron is eco-friendly and the electric car manufactured by Tesla will be a public relations coup. He offers to invest in Tesla Motors by lending his buddy cash in exchange for a $10,000,000 note for a 3 year term. The note specifies a stated interest rate of 8% payable annually each December 31^st. The effective rate expected by most investors, given the uncertainty in today's capital markets, is 12%. The note is dated and issued on January 1, 2017.

On the books of Tesla Motors (round to nearest dollar):

Identify The journal entry required at the issuance for the not. You must calculate the amount of cash Lebron is willing to give to Elon in exchange for the note on 1/1/17.

Identify the journal entries required at the time of the interest payment on 12/31/17 and 12/31/18

The relationship becomes contentious and musk decides to buyout the note on January 1, 2019 for $9.7 million. Identify the journal entry required to extinguish the loan.

On March 1, 2017 Pru Financial decides t repurchase 500,000 shares of its class A $10 par value common stock at a price of $112. This transaction pushes the stock to $125 so on September 15, 2017 Pru reissues 300,000 of the treasury shares. However on December 7^thPru experiences a cash flow crisis, and the market goes through a correction causing the Pru stock price to drop to $90. On that date, Pru reissues the remaining 200,000 treasury shares. (Step by step or no credit will be awarded).

Identify the journal entry on the books of Pru on:

March 1, 2017

September 15,2017

December 7, 2017

Intermediate II Table 7A.2 present vale of 1 8% 9% 10% 11% .92593 .91743 .90909 .90090 .85734 .84168 .82645 .81162 .79383 .77218 .75132 .73119 .73503 .70843 .68301 .65873 .68058 .64993 .62092 .59345 12% .89286 .79719 .71178 .63552 .56743 15% .86957 .75614 .65752 .57175 .49718 (N) Periods 1 2 3 4 5 TABLE 7A.5 PRESENT BALUE OF AN ORDINARY ANUITY OF 1 8% 9% 10% 11% 12% 15% (n) Periods .92593 .91743 .90909 .90090 .89286 .86957 1 1.78326 1.75911 1.73554 1.71252 1.69005 1.62572 2 2.57710 2.53130 2.48685 2.44371 2.40183 2.28323 3 3.31213 3.23972 3.16986 3.10245 3.03735 2.85498 4 3.99271 3.88965 3.79079 3.69590 3.60478 3.35216 5 1. Lebron kozlowski, owner of the King Enterprises, is a college classmate of Elon Musk. Musk is the founder and chief architect of Tesla Motors (maker of the first electric luxury sports car), and CEO and CTO of Space X and Chairman of SolarCity. Lebron is ecofriendly and the electric car manufactured by Tesla will be a public relations coup. He offers to invest in Tesla Motors by lending his buddy cash in exchange for a $10,000,000 note for a 3 year term. The note specifies a stated interest rate of 8% payable annually each December 31st. The effective rate expected by most investors, given the uncertainty in today's capital markets, is 12%. The note is dated and issued on January 1, 2017. Required: On the books of Tesla Motors (round to nearest dollar): (A) Identify The journal entry required at the issuance for the not. You must calculate the amount of cash Lebron is willing to give to Elon in exchange for the note on 1/1/17. (B) Identify the journal entries required at the time of the interest payment on 12/31/17 and 12/31/18 (C) The relationship becomes contentious and musk decides to buyout the note on January 1, 2019 for $9.7 million. Identify the journal entry required to extinguish the loan. 2. On March 1, 2017 Pru Financial decides t repurchase 500,000 shares of its class A $10 par value common stock at a price of $112. This transaction pushes the stock to $125 so on September 15, 2017 Pru reissues 300,000 of the treasury shares. However on December 7th Pru experiences a cash flow crisis, and the market goes through a correction causing the Pru stock price to drop to $90. On that date, Pru reissues the remaining 200,000 treasury shares. (Step by step or no credit will be awarded). Required: Identify the journal entry on the books of Pru on: (1) March 1, 2017 (3 points) (2) September 15,2017 (3) December 7, 2017