Question :
Learning Objective 7-3
1) When companies borrow money for longer than : 1253316
Learning Objective 7-3
1) When companies borrow money for longer than one year, that obligation is called ________.
A) equity financing
B) a long-term liability
C) an operating activity
D) a current liability
2) On January 1, 2011, Climax Corporation signed a $10,000,000, 6%, 10-year mortgage note to finance the construction of its new hotel in Cancun. The note will be repaid in 10 equal annual installments of $1,358,679. The first payment was made on December 31, 2011. How much of the first mortgage payment was interest? Round your answer to the nearest dollar.
A) $1,000,000
B) $81,521
C) $1,358,679
D) $600,000
3) On January 1, 2011, Climax Corporation signed a $10,000,000, 6%, 10-year mortgage note to finance the construction of its new hotel in Cancun. The note will be repaid in 10 equal annual installments of $1,358,679. The first payment was made on December 31, 2011. How much of the first mortgage payment will be used to reduce the principal? Round your answer to the nearest dollar.
A) $758,679
B) $1,358,679
C) $0
D) $600,000
4) On January 1, 2011, Climax Corporation signed a $10,000,000, 6%, 10-year mortgage note to finance the construction of its new hotel in Cancun. The note will be repaid in 10 equal annual installments of $1,358,679. Over the 10-year period, as each installment payment is made, the portion of the payment that is interest expense will ________.
A) increase
B) decrease
C) stay the same
D) The answer cannot be determined from the information given.
5) On January 1, 2011, Climax Corporation signed a $10,000,000, 6%, 10-year mortgage note to finance the construction of its new hotel in Cancun. The note will be repaid in 10 equal annual installments of $1,358,679. Over the 10-year period, as each installment payment is made, the portion of the payment that is used to reduce the principal will ________.
A) increase
B) decrease
C) stay the same
D) The answer cannot be determined from the information given.
6) On January 1, 2011, Climax Corporation signed a $10,000,000, 6%, 10-year mortgage note to finance the construction of its new hotel in Cancun. The note will be repaid in 10 equal annual installments of $1,358,679. Over the 10-year period, as each installment payment is made, the amount that Climax Corporation will show on its balance sheet for mortgage payable will ________.
A) increase
B) decrease
C) stay the same
D) The answer cannot be determined from the information given.
7) On January 1, 2011, Ajax Corporation signed a $1,000,000, 7%, 10-year mortgage note to buy a new warehouse. The note will be repaid in 10 equal annual installments of $142,378. The first payment was made on December 31, 2011. How much of the first mortgage payment was interest? Round your answer to the nearest dollar.
A) $9,967
B) $70,000
C) $0
D) $142,378
8) On January 1, 2011, Ajax Corporation signed a $1,000,000, 7%, 10-year mortgage note to buy a new warehouse. The note will be repaid in 10 equal annual installments of $142,378. The first payment was made on December 31, 2011. How much of the first mortgage payment will be used to reduce the principal? Round your answer to the nearest dollar.
A) $72,378
B) $132,412
C) $0
D) $142,378
9) On January 1, 2011, Ajax Corporation signed a $1,000,000, 7%, 10-year mortgage note to buy a new warehouse. The note will be repaid in 10 equal annual installments of $142,378. Over the 10-year period, as each installment payment is made, the portion of the payment that is interest expense will ________.
A) increase
B) decrease
C) stay the same
D) The answer cannot be determined from the information given.
10) On January 1, 2011, Ajax Corporation signed a $1,000,000, 7%, 10-year mortgage note to buy a new warehouse. The note will be repaid in 10 equal annual installments of $142,378. Over the 10-year period, as each installment payment is made, the portion of the payment that is used to reduce the principal will ________.
A) increase
B) decrease
C) stay the same
D) The answer cannot be determined from the information given.
