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Use the Following Information for Questions 91 and 92

question 23

Multiple Choice

Use the following information for questions 91 and 92.
Metro Company, a dealer in machinery and equipment, leased equipment to Sands, Inc., on
July 1, 2015. The lease is appropriately accounted for as a sales-type lease by Metro and as a capital lease by Sands. The lease is for a 10-year period (the useful life of the asset) expiring June 30, 2025. The first of 10 equal annual payments of $552,000 was made on July 1, 2015. Metro had purchased the equipment for $3,500,000 on January 1, 2015, and established a list selling price of $4,800,000 on the equipment. Assume that the present value at July 1, 2015, of the rent payments over the lease term discounted at 8% (the appropriate interest rate) was $4,000,000.
-Assuming that Sands, Inc. uses straight-line depreciation, what is the amount of deprecia-tion and interest expense that Sands should record for the year ended December 31, 2015?

Know the effects of corporate restructuring on stock value and how appraisal rights work.

Learn about the specific legal protections and strategies corporations can employ against unwanted takeovers.

Distinguish between the various outcomes of restructuring strategies on corporate identity and legal status.

Acknowledge the ethical considerations and potential negative consequences of corporate restructuring tactics.

Definitions:

Marginal Value Curve

A graphical representation that shows how the value (or utility) of consuming an additional unit of a good or service changes as consumption increases.

Expenditure Curves

Expenditure curves represent the relationship between the quantity of goods purchased and the amount of money spent.

Monopsony Power

A market condition where there is only one buyer for a product or service, giving that buyer significant control over prices.

Price

Price is the amount of money expected, required, or given in payment for something, playing a central role in the economics of market transactions.