Homework Answers
| Description | Debit | Credit |
| Right-of-use asset | 117761 | |
| Lease liability | 117761 | |
| (To record inception of lease) |
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Leases On January 1, Lorraine, Inc., entered into a lease contract. The lease contract was a ten-year lease for a compu...
No C. D. No No Yes [51 On January 1, Year 1, Lessee entered into a 4-year lease and did not incur...
No C. D. No No Yes [51 On January 1, Year 1, Lessee entered into a 4-year lease and did not incur initial direct costs. At the lease commencement date, Lessee A. Must discount the lease payments using the lessor's incremental borrowing rate. B. Recognizes the same amount for the right-of-use asset and the lease liability under a finance lease and an operating lease. C. Applies different accounting for initial measurement of a right-of-use asset under finance and operating leases....
On 1 January 2019, Walkinson Ltd entered into a 6-year contract to lease a crane for...
On 1 January 2019, Walkinson Ltd entered into a 6-year contract to lease a crane for its freight terminal. When negotiating the lease contract, on 1 January 2019, Walkinson Ltd paid direct costs of $20,000 for technical advice from an engineering consultancy. The lease contract requires Walkinson Ltd to make 6 annual lease payments of $60,000, commencing on 30 June 2019. The lease contract includes a bargain purchase option, (which Walkinson Ltd is expected to exercise), to purchase the crane...
QUESTION On 1 January 2019, Walkinson Ltd entered into a 6-year contract to lease a crane...
QUESTION On 1 January 2019, Walkinson Ltd entered into a 6-year contract to lease a crane for its freight terminal. When negotiating the lease contract, on 1 January 2019, Walkinson Ltd paid direct costs of $20,000 for technical advice from an engineering consultancy. The lease contract requires Walkinson Ltd to make 6 annual lease payments of $60,000, commencing on 30 June 2019. The lease contract includes a bargain purchase option, (which Walkinson Ltd is expected to exercise), to purchase the...
QUESTION On 1 January 2019, Walkinson Ltd entered into a 6-year contract to lease a crane...
QUESTION On 1 January 2019, Walkinson Ltd entered into a 6-year contract to lease a crane for its freight terminal. When negotiating the lease contract, on 1 January 2019, Walkinson Ltd paid direct costs of $20,000 for technical advice from an engineering consultancy. The lease contract requires Walkinson Ltd to make 6 annual lease payments of $60,000, commencing on 30 June 2019. The lease contract includes a bargain purchase option, (which Walkinson Ltd is expected to exercise), to purchase the...
Leased Asset Hopper Corporation signed a ten-year capital lease or finance lease on January 1, 2017. The lease requires...
Leased Asset Hopper Corporation signed a ten-year capital lease or finance lease on January 1, 2017. The lease requires annual payments of $8,000 every December 31. Use the appropriate present value table: PV of $1, PV of Annuity of $1 Required: 1. Assuming an interest rate of 10%, calculate the present value of the minimum lease payments. Round your answer to the nearest whole dollar. 2. Hopper should report a long term liability to accompany its capitalized leased asset equal...
4 (20 points teases On January 1, 2020 Klowa Co. leases equipment on a three-year lease....
4 (20 points teases On January 1, 2020 Klowa Co. leases equipment on a three-year lease. This lease is a finance lease. The lease requires three $25,480 lease payments (the first is on 1/1/20, the second is on 12/31/20, and the third is on 12/31/21. The present value of the three annual lease payments is $70,980, using a 7.9% interest rate. a) Complete the lease payment schedule below. Round to the nearest dollar. Show and label supporting computations as needed....
On 1 July 2018, Louis Ltd entered into an 8-year contract to lease a ship for...
On 1 July 2018, Louis Ltd entered into an 8-year contract to lease a ship for its salvage business. When negotiating the lease contract, on 1 July 2018, Louis Ltd paid direct costs of $18,000 for engineering advice. The lease contract requires Louis Ltd to make 8 annual lease payments of $80,000, with the first payment due on 30 June 2019. The lease contract includes a guaranteed residual of $130,000, which is payable by Louis Ltd at the end of...
On January 1, Harbor (lessee) signs a five-year lease for equipment that is accounted for as...
On January 1, Harbor (lessee) signs a five-year lease for equipment that is accounted for as a finance lease. The lease requires five $21,000 lease payments (the first at the beginning of the lease and the remaining four at December 31 of years 1, 2, 3, and 4), and the present value of the five annual lease payments is $90,555, based on an 8% interest rate. 1. Prepare the January 1 journal entry Harbor records at inception of the lease...
Rauch Incorporated leases a piece of equipment to Donahue Corporation on January 1, 2020. The lease...
Rauch Incorporated leases a piece of equipment to Donahue
Corporation on January 1, 2020. The lease agreement called for
annual rental payments of $4,892 at the beginning of each year of
the 4-year lease. The equipment has an economic useful life of 6
years, a fair value of $25,000, a book value of $20,000, and both
parties expect a residual value of $8,250 at the end of the lease
term, though this amount is not guaranteed. Rauch set the lease...
Rauch Incorporated leases a piece of equipment to Donahue Corporation on January 1, 2017. The lease...
Rauch Incorporated leases a piece of equipment to Donahue Corporation on January 1, 2017. The lease agreement called for annual rental payments of $4,892 at the beginning of each year of the 4- year lease. The equipment has an economic useful life of 6 years, a fair value of $25,000, a book value of $20,000, and both parties expect a residual value of $8,250 at the end of the lease term, though this amount is not guaranteed. Rauch set the...
No C. D. No No Yes [51 On January 1, Year 1, Lessee entered into a 4-year lease and did not incur initial direct costs. At the lease commencement date, Lessee A. Must discount the lease payments using the lessor's incremental borrowing rate. B. Recognizes the same amount for the right-of-use asset and the lease liability under a finance lease and an operating lease. C. Applies different accounting for initial measurement of a right-of-use asset under finance and operating leases....
Leased Asset Hopper Corporation signed a ten-year capital lease or finance lease on January 1, 2017. The lease requires annual payments of $8,000 every December 31. Use the appropriate present value table: PV of $1, PV of Annuity of $1 Required: 1. Assuming an interest rate of 10%, calculate the present value of the minimum lease payments. Round your answer to the nearest whole dollar. 2. Hopper should report a long term liability to accompany its capitalized leased asset equal...
4 (20 points teases On January 1, 2020 Klowa Co. leases equipment on a three-year lease. This lease is a finance lease. The lease requires three $25,480 lease payments (the first is on 1/1/20, the second is on 12/31/20, and the third is on 12/31/21. The present value of the three annual lease payments is $70,980, using a 7.9% interest rate. a) Complete the lease payment schedule below. Round to the nearest dollar. Show and label supporting computations as needed....
On January 1, Harbor (lessee) signs a five-year lease for equipment that is accounted for as a finance lease. The lease requires five $21,000 lease payments (the first at the beginning of the lease and the remaining four at December 31 of years 1, 2, 3, and 4), and the present value of the five annual lease payments is $90,555, based on an 8% interest rate. 1. Prepare the January 1 journal entry Harbor records at inception of the lease...
Rauch Incorporated leases a piece of equipment to Donahue
Corporation on January 1, 2020. The lease agreement called for
annual rental payments of $4,892 at the beginning of each year of
the 4-year lease. The equipment has an economic useful life of 6
years, a fair value of $25,000, a book value of $20,000, and both
parties expect a residual value of $8,250 at the end of the lease
term, though this amount is not guaranteed. Rauch set the lease...
Rauch Incorporated leases a piece of equipment to Donahue Corporation on January 1, 2017. The lease agreement called for annual rental payments of $4,892 at the beginning of each year of the 4- year lease. The equipment has an economic useful life of 6 years, a fair value of $25,000, a book value of $20,000, and both parties expect a residual value of $8,250 at the end of the lease term, though this amount is not guaranteed. Rauch set the...
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