Homework Answers
Parties agree that payment will be in 4 equal installment.
Machine is worth $ 50,000.So $50,000/4 = $12500
Present value of all installment
| Installment | P.V Factor | Present Value |
| 12500 | 1 | 12500 |
| 12500 | 0.961538 | 12109.23 |
| 12500 | 0.924556 | 11556.95 |
| 12500 | 0.888996 | 11112.45 |
| Total Present Value | 47188.64 | |
Journal entry for Lessee corporation
| Date | Journal | Debit | Credit |
| 01/01/2018 | Lease Asset Dr | $47188.64 | |
| to Lease Liability | $47188.64 | ||
| 01/01/2018 | Lease Liability Dr | $12500 | |
| to cash | $12500 |
Lessee corporation balance sheet
Equipment as on December 31,2018 $47188.64
Lease Payable as on December 31, 2018 $47188.64 - $12500 = $34688.64
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renewal option. Payments of $978,446 are due on January 1of each
year.
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salvage value.
3. ABC Company depreciates similar...
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for the following:
At lease inception on January 1, Year 1
When the first lease payment is made on June 30, Year 1
When the second lease payment is made on December 31, Year
1
Determine the interest paid over the life of the lease.
From Acwen’s perspective, provide the journal entries
for the following:
At lease inception on January 1, Year 1
When the first lease payment is made on June 30,...
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