Using the Information Below Answer the Following Questions

question 32

Multiple Choice

Using the information below answer the following questions:
The operating lease is a 3-year lease commencing on 1 January 2012 with payments of $20 000 on 31 December in each of the 3 years. Assume the lease had been treated as a capital lease instead of an operating lease (using a 12% discount rate the present value of the lease payments is $48036; the company uses straight line depreciation for its capital leases) .
-If the lease is treated as a capital lease,what would be the total expense reported in 2009 related to the lease?

• A) $20 000
• B) $16 012
• C) $21 776
• D) $32 024.

Comprehend the effect of the principal's death on the agent's authority as per the Third Restatement.

Understand the requirements for giving actual notice to terminate an agent's authority.

Learn the situations in which an agent can act on behalf of the principal and their liability in contracts.

Recognize the principle of ratification and its requirements.

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Definitions:

Accounts Receivable-Kagome

An account representing money owed to Kagome (presumably a company) by its customers for goods or services that have been delivered but not yet paid for.

Equity Method Investments-Ferris

A specific example or case of using the equity method for accounting for investments in which an investor has significant influence over the investee, but does not control it.

Cash Dividends

Payments made by a company to its shareholders out of its profits in the form of cash.

Net Income

The final amount of profit a company makes after subtracting costs, taxes, and expenses from its gross revenue.