Assignment Exercise 22-1 Financial Statement Capital Structures Required: Find the three different financial statements that have varying capital structures. Write paragraph about each that explains the debt-equity relationship and that computes the percent of debt and the percent of equity represented. Also note whether the percent of annual interest on debts is revealed in the notes to the financial statements. If so, you believe the interest rate is fair and equitable? Why? Assignment Exercise 23-1: Cost of Owing and cost of Leasing Cost of owing and cost of leasing tables reproduced below: Required: Using the appropriate table from the Chapter 12 Appendices, record the present value factor at 10% for each year and compute the present value cost of owing and the present value of leasing. Which alternative is more desirable at this interest rate? Do you think your answer would change if the interest rate was six percent instead of ten percent? Cost of owing: Anywhere clinic-comparative present value For-profit cost ofowning: year0 year1 year2 year3 year4 year5 (48,750) 2, 500 2,5002,500 2,500 2,500 Net Cash Flow Present value factor Present Value answers= Present value cost of owing= Cost of Leasing: Anywhere Clinic- comparative Present Value Line For-Profit Cost
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