Sage Hill Leasing Company signs a lease agreement on January 1, 2020, to lease electronic equipment to Oriole Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement: 1. Oriole has the option to purchase the equipment for $17,000 upon termination of the lease. It is not reasonably certain that Oriole will exercise this option.
2. The equipment has a cost of $140,000 and fair value of $195,500 to Sage Hill Leasing. The useful economic life is 2 years, with a residual value of $17,000.
3. Sage Hill Leasing desires to earn a return of 5% on its investment.
4. Collectibility of the payments by Sage Hill Leasing is probable

Required:
Prepare the journal entries on the books of Sage Hill Leasing to reflect the payments received under the lease and to recognize income for the years 2017 and 2018.

The bonds issued by the south foot bear a coupon rate of 7.5 percent, payable semiannually. the bonds mature in 6.5 years, sell at par, and have a $1,000 face value. what is the yield to maturity

Uestion 7 you hold a portfolio consisting of a $5,000 investment in each of 20 different stocks. the portfolio beta is equal to 1.12. you have decided to sell a coal mining stock (b = 1.00) at $5,000 net and use the proceeds to buy a like amount of a mineral rights company stock (b = 2.00). what is the new beta of the portfolio?

Afirm's before-tax cost of debt, rd, is the interest rate that the firm must pay on debt. because interest is tax deductible, the relevant cost of debt used to calculate a firm's wacc is the cost of debt, rd (1 – t). the cost of debt is used in calculating the wacc because we are interested in maximizing the value of the firm's stock, and the stock price depends on cash flows. it is important to emphasize that the cost of debt is the interest rate on debt, not debt because our primary concern with the cost of capital is its use in capital budgeting decisions. the rate at which the firm has borrowed in the past is because we need to know the cost of capital. for these reasons, the on outstanding debt (which reflects current market conditions) is a better measure of the cost of debt than the . the on the company's -term debt is generally used to calculate the cost of debt because more often than not, the capital is being raised to fund -term projects. quantitative problem: 5 years ago, barton industries issued 25-year noncallable, semiannual bonds with a $1,600 face value and a 8% coupon, semiannual payment ($64 payment every 6 months). the bonds currently sell for $845.87. if the firm's marginal tax rate is 40%, what is the firm's after-tax cost of debt? round your answer to 2 decimal places. do not round intermediate calcu