BE20-11 Merrill Corporation, which uses ASPE, enters into a six-year lease of equipment on September 13,...
BE20-11 Merrill Corporation, which uses ASPE, enters into a six-year lease of equipment on September 13, 2017 that requires six annual payments of $28,000 each, beginning September 13, 2017. In addition, Merrill guarantees the lessor a residual value of $17,000 at lease end. The equipment has a useful life of six years. Using tables, a fi nancial calculator, or Excel functions, calculate the amount of the capital lease and prepare Merrill’s September 13, 2017 journal entries, assuming an interest rate of 9%. Use the information for Merrill Corporation from BE20-11. Assume that a residual value of $17,000 is expected at the end of the lease, but that Merrill does not guarantee the residual value. Using tables, a financial calculator, or Excel functions, calculate the amount of the capital lease and prepare Merrill’s September 13, 2017 journal entries, assuming an interest rate of 9% and that Merrill also uses ASPE.
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BE20-11 Merrill Corporation, which uses ASPE, enters into a
six-year lease of equipment on September 13,...
Riverbed Corporation enters into a 7-year lease of equipment on January 1, 2017, which requires 7...
Riverbed Corporation enters into a 7-year lease of equipment on January 1, 2017, which requires 7 annual payments of $41,100 each, beginning January 1, 2017. In addition, Riverbed guarantees the lessor a residual value of $18,400 at lease-end. The equipment has a useful life of 7 years. Prepare Riverbed’ January 1, 2017, journal entries assuming an interest rate of 10%.
Coronado Corporation enters into a 7-year lease of equipment on December 31, 2016, which requires 7...
Coronado Corporation enters into a 7-year lease of equipment on December 31, 2016, which requires 7 annual payments of $37,300 each, beginning December 31, 2016. In addition, Coronado guarantees the lessor a residual value of $19,400 at the end of the lease. However, Coronado believes it is probable that the expected residual value at the end of the lease term will be $9,400. The equipment has a useful life of 7 years. Assume that for Lost Ark Company, the lessor,...
Kingbird Corporation enters into a 6-year lease of equipment on December 31, 2019, which requires 6...
Kingbird Corporation enters into a 6-year lease of equipment on December 31, 2019, which requires 6 annual payments of $37,400 each, beginning December 31, 2019. In addition, Kingbird guarantees the lessor a residual value of $22,000 at the end of the lease. However, Kingbird believes it is probable that the expected residual value at the end of the lease term will be $12,000. The equipment has a useful life of 6 years. Assume that for Lost Ark Company, the lessor,...
Indigo Corporation enters into a 7-year lease of equipment on December 31, 2016, which requires 7...
Indigo Corporation enters into a 7-year lease of equipment on
December 31, 2016, which requires 7 annual payments of $37,500
each, beginning December 31, 2016. In addition, Indigo guarantees
the lessor a residual value of $18,700 at the end of the lease.
However, Indigo believes it is probable that the expected residual
value at the end of the lease term will be $8,700. The equipment
has a useful life of 7 years. Prepare Indigos' December 31, 2016,
journal entries assuming...
Oriole Leasing Corporation, which uses IFRS 16, signs a lease agreement on January 1, 2020, to...
Oriole Leasing Corporation, which uses IFRS 16, signs a lease agreement on January 1, 2020, to lease electronic equipment to Wai Corporation, which also uses IFRS 16. The term of the non-cancellable lease is two years and payments are required at the end of each year. The following information relates to this agreement. 1. Wai Corporation has the option to purchase the equipment for $12,400 upon the termination of the lease and this option is reasonably certain to be exercised....
Oriole Leasing Corporation, which uses IFRS 16, signs a lease agreement on January 1, 2020, to...
Oriole Leasing Corporation, which uses IFRS 16, signs a lease agreement on January 1, 2020, to lease electronic equipment to Wai Corporation, which also uses IFRS 16. The term of the non-cancellable lease is two years and payments are required at the end of each year. The following information relates to this agreement. 1. Wai Corporation has the option to purchase the equipment for $12,400 upon the termination of the lease and this option is reasonably certain to be exercised....
Lanier Dairy Ltd. leases its milk cooling equipment from Green Finance Corporation. Both companies use IFRS...
Lanier Dairy Ltd. leases its milk cooling equipment from Green Finance Corporation. Both companies use IFRS 16. The lease has the following terms. 1. The lease is dated May 30, 2017, with a lease term of eight years. It is non-cancellable and requires equal rental payments of $30,000 due each May 30, beginning in 2017. 2. The equipment has a fair value and cost at the inception of the lease of $211,902, an estimated economic life of 10 years, and...
P20.18 Lanier Dairy Ltd. leases its milk cooling equipment from Green Finance Corporation. Both companies use IFRS 16. The lease has the following terms. The lease is dated May 30, 2020, with a lease term of eight years. It is non-cancellable and require
P20.18 Lanier Dairy Ltd. leases its milk cooling equipment from Green Finance Corporation. Both companies use IFRS 16. The lease has the following terms.The lease is dated May 30, 2020, with a lease term of eight years. It is non-cancellable and requires equal rental payments of $30,000 due each May 30, beginning in 2020.The equipment has a fair value and cost at the inception of the lease of $211,902, an estimated economic life of 10 years, and a residual value (which...
P20.15 CHL Corporation manufactures specialty equipment with an estimated economic life of 12 years and leases it to Provincial Airlines Corp. for a period of 10 years. Both CHL and Provincial Airlines follow ASPE. The equipment’s normal selling price is
P20.15 CHL Corporation manufactures specialty equipment with an estimated economic life of 12 years and leases it to Provincial Airlines Corp. for a period of 10 years. Both CHL and Provincial Airlines follow ASPE. The equipment’s normal selling price is $210,482 and its unguaranteed residual value at the end of the lease term is estimated to be $15,000. Provincial Airlines will make annual payments of $25,000 at the beginning of each year and pay for all maintenance and insurance. CHL...
Exercise 20-11 Oriole Leasing Corporation, which uses IFRS 16, signs a lease agreement on January...
Exercise 20-11 Oriole Leasing Corporation, which uses IFRS 16, signs a lease agreement on January 1, 2017 to lease electronic equipment to Wai Corporation, which also uses IFRS 16. The term of the non-cancellable lease is two years and payments are required at the end of each year. The following information relates to this agreement. 1. Wai Corporation has the option to purchase the equipment for $12,800 upon the termination of the lease and this option is reasonably certain to...
Kingbird Corporation enters into a 6-year lease of equipment on December 31, 2019, which requires 6 annual payments of $37,400 each, beginning December 31, 2019. In addition, Kingbird guarantees the lessor a residual value of $22,000 at the end of the lease. However, Kingbird believes it is probable that the expected residual value at the end of the lease term will be $12,000. The equipment has a useful life of 6 years. Assume that for Lost Ark Company, the lessor,...
Indigo Corporation enters into a 7-year lease of equipment on
December 31, 2016, which requires 7 annual payments of $37,500
each, beginning December 31, 2016. In addition, Indigo guarantees
the lessor a residual value of $18,700 at the end of the lease.
However, Indigo believes it is probable that the expected residual
value at the end of the lease term will be $8,700. The equipment
has a useful life of 7 years. Prepare Indigos' December 31, 2016,
journal entries assuming...
P20.18 Lanier Dairy Ltd. leases its milk cooling equipment from Green Finance Corporation. Both companies use IFRS 16. The lease has the following terms.The lease is dated May 30, 2020, with a lease term of eight years. It is non-cancellable and requires equal rental payments of $30,000 due each May 30, beginning in 2020.The equipment has a fair value and cost at the inception of the lease of $211,902, an estimated economic life of 10 years, and a residual value (which...
Exercise 20-11 Oriole Leasing Corporation, which uses IFRS 16, signs a lease agreement on January 1, 2017 to lease electronic equipment to Wai Corporation, which also uses IFRS 16. The term of the non-cancellable lease is two years and payments are required at the end of each year. The following information relates to this agreement. 1. Wai Corporation has the option to purchase the equipment for $12,800 upon the termination of the lease and this option is reasonably certain to...
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