HW #9.xlsx

# HW #9.xlsx - A Years Amount 0 1 2 3 4 5 6 7 8 9 10 11 12 13...

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A Years Amount Year Operating lease 0 -170 2013 \$ 678 1 18 2014 \$ 634 2 18 2015 \$ 592 3 19 2016 \$ 556 4 19 2017 \$ 500 5 17 >2017 \$ 500 6 17 7 17 8 17 9 17 10 17 11 17 12 17 13 17 14 17 15 17 16 17 17 2 IRR 6.66% Depreciation \$ 239,930,865 Interest Expense \$ 271,479,579 B Formulas I used in order to come up with the fi 1)Remaining lease years : Total payments 2018 and thereafter / Lease paym 2)Discount Factor = 1/(1+r)^n 3)Present Value = Operating lease* Discount fac 4)Depreciation = Total value of the lease asset / 5)Interest Expense = Totale present value * Inter As we calculated above, we have \$4,079,000 that needs to be included on the balance sheet to the long-term liability category. This will help liability to increase for YUMM Company. Currently the figured reported is \$6,699,000. However, this figure will increase by \$4,079,000.

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Discount Factor Present Value 0.938 \$ 636 0.879 \$ 557 0.824 \$ 488 0.773 \$ 430 0.725 \$ 362 3.212 \$ 1,606 TOTAL \$ 4,079 figures ment of the year 2017 ctor Total life of the asset rest rate
A E B F C G D H Service cost Service cost refers to pension plan benefits earned by an employee from a company. It represents the service years he or she spent working for a company.

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