S& r issued 8% stated rate bonds with a face amount of $100 million. the bonds mature on december 31, 2036 (20 years). the market rate of interest for similar bond issues was 9% (4.5% semiannual rate). interest is paid semiannually (4%) on june 30 and december 31, beginning on june 30, 2019. 2.the company leased two manufacturing facilities. lease a requires 20 annual lease payments of $200,000 beginning on january 1, 2019. lease b also is for 20 years, beginning january 1, 2019. terms of the lease require 17 annual lease payments of $220,000 beginning on january 1, 2022. generally accepted accounting principles require both leases to be recorded as liabilities for the present value of the scheduled payments. assume that a 10% interest rate properly reflects
the time value of money for the lease obligations. what amounts will appear in s& r's december 31, 2016, balance sheet for the bonds and for the leases?

Which of the following actions would be most likely to reduce potential conflicts of interest between stockholders and bondholders? a) compensating managers with stock options, b) financing risky projects with additional debt, c) the threat of hostile takeovers, d) the use of covenants in bond agreements that limit the firm's use of additional debt and constrain managers actions, e) abolishing the security and exchange commission

Exercise 18-15 sheffield appliance center is an experienced home appliance dealer. sheffield appliance center also offers a number of services for the home appliances that it sells. assume that sheffield appliance center sells ovens on a standalone basis. sheffield appliance center also sells installation services and maintenance services for ovens. however, sheffield appliance center does not offer installation or maintenance services to customers who buy ovens from other vendors. pricing for ovens is as follows. oven only $790 oven with installation service 850 oven with maintenance services 970 oven with installation and maintenance services 990 in each instance in which maintenance services are provided, the maintenance service is separately priced within the arrangement at $180. additionally, the incremental amount charged by sheffield appliance center for installation approximates the amount charged by independent third parties. ovens are sold subject to a general right of return. if a customer purchases an oven with installation and/or maintenance services, in the event sheffield appliance center does not complete the service satisfactorily, the customer is only entitled to a refund of the portion of the fee that exceeds $790. assume that a customer purchases an oven with both installation and maintenance services for $990. (b) indicate the amount of revenue that should be allocated to the oven, the installation, and to the maintenance contract.

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