On the last day of its fiscal year ending December 31, 2021, the Sedgwick &...
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Finance
On the last day of its fiscal year ending December 31, 2021, the Sedgwick & Reams (S&R) Glass Company completed two financing arrangements. The funds provided by these initiatives will allow the company to expand its operations. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 1. S&R issued 7% stated rate bonds with a face amount of $100 million. The bonds mature on December 31, 2041 (20 years). The market rate of interest for similar bond issues was 8% (4.0% semiannual rate). Interest is paid semiannually (3.5%) on June 30 and December 31, beginning on June 30, 2022. 2. The company leased two manufacturing facilities. Lease A requires 20 annual lease payments of $260,000 beginning on January 1, 2022. Lease B also is for 20 years, beginning January 1, 2022. Terms of the lease require 17 annual lease payments of $280,000 beginning on January 1, 2025. Generally accepted accounting principles require both leases to be recorded as liabilities for the present value of the scheduled payments. Assume that a 9% interest rate properly reflects the time value of money for the lease obligations. Required: What amounts will appear in S&R's December 31, 2021, balance sheet for the bonds and for the leases? (Enter your answers in whole dollars. Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.)
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