财务报表析与运用杰拉尔德课后答案英文版第十一章.doc

Chapter 11 Solutions Overview: Problem Length Problem #s {S} 1 - 4, 9, 11, 12, 15, 16, 21, 22 {M} 5, 7, 8, 10, 13, 14, 17, 18, 20, 23, 24 {L} 6, 19, 25 1.{S}(i) Interest expense = 12% x $10,000 (beginning balance of lease obligation) = $1,200. The lease obligation will be reduced by $100 ($1,300 - $1,200) leaving an obligation of $9,900. Cash from Operations will be reduced by the interest payment of $1,200. Cash from investing activities will not be affected. (However, the firm will report the capital lease as a “noncash investment and financing activity.” Cash from financing will be reduced by the amount of the principal payment of $100. Under an operating lease there is no lease obligation on the balance sheet. The only effect on income is Rent Expense of $1,300. Similarly, CFO is reduced by $1,300. (CFI and CFF are not affected). 2.{S}(i) In a take-or-pay arrangement, a company contracts to buy or pay for a certain amount of a supplier’s commodity at a predetermined price over a stated time period. The company, by entering the contract, incurs an economic liability. However, since it is only a contract, no accounting liability is recorded on the balance sheet – it is off balance sheet. (ii) In a sale of receivable, a company “sells” its receivables to a third-party, usually a financial institution. Typically, the sale is made at a discounted price from the face value and the seller may retain some or all of the default risk. The sale, in substance, is a financing arrangement with the receivables being used as collateral. However, under GAAP, the transaction is treated as a sale and the debt does not appear on the balance sheet. (iii)A joint venture represents an investment of 50% or less by one company (the “investor”) in another company. Under GAAP, since ownership is not over 50%, the assets and liabilities of the joint venture need not be consolidated with the parent’s assets and liabilities. Hence, any debt taken on by the joint venture remains o