Toni Pena is the sole owner of Deer Park, a public camping ground near the Lake Mead National Recreation Area. Toni has compiled the following financial information as of December 31, 20 12. Instructions
Revenues during 2012—camping fees Revenues during 2012—general store Accounts payable
Cash on hand
$140,000 Fair value of equipment 65,000 Notes payable
11,000 Expenses during 2012 23,000 Supplies on hand
105,500
(a) Determine Toni Pena’s net income from Deer Park for 2012.
$140,000 60,000 150,000 17,500
Original cost of equipment
Instructions

Secured loans are protected by collateral security. examples: title loans where the borrower uses the car title as collateral security interest rates are lower and repayments are longer therefore risk is low as a collateral security is given as guarantee to the bank in case of failure to pay the loanunsecured loans are not protected by collateral security but it is given on the creditworthiness of the borrower, trusting that she/he will pay on time. examples; payday loans is a short term loan where the borrower lends money from the bank and pays is back when the borrower receives his/her wages.interest rates are high and repayments are shorter. but the risk is high as no collateral security is given as a guarantee to the bank for payment of the loan

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