On November 1, 2013, Wenger Co. paid its landlord $4,380 in cash as an advance rent payment on its store location. The six-month lease period ends on April 30, 2014, at which time the contract may be renewed. Required:
a. Use the horizontal model or write the journal entry to record the six-month advance rent payment on November 1, 2010.
b. Use the horizontal model or write the adjusting entry that will be made at the end of every month to show the amount of rent "used" during the month.
c. Calculate the amount of prepaid rent that should be reported on the December 31, 2010, balance sheet with respect to this lease.
d. If the advance payment made on November 1, 2010, had covered an 18-month lease period at the same amount of rent per month, how should Wenger Co. report the prepaid amount on its December 31, 2010, balance sheet?

Variable rate cd’s = $90 treasury bills = $150 discount loans = $20 treasury notes = $100 fixed rate cds = $160 money market deposit accts. = $140 savings deposits = $90 fed funds borrowing = $40 variable rate mortgage loans $140 demand deposits = $40 primary reserves = $50 fixed rate loans = $210 fed funds lending = $50 equity capital = $120 a. develop a balance sheet from the above data. be sure to divide your balance sheet into rate-sensitive assets and liabilities as we did in class and in the examples. b. perform a standard gap analysis and a duration analysis using the above data if you have a 1.15% decrease in interest rates and an average duration of assets of 5.4 years and an average duration of liabilities of 3.8 years. c. indicate if this bank will remain solvent after the valuation changes. if so, indicate the new level of equity capital after the valuation changes. if not, indicate the amount of the shortage in equity capital.