Which of the following would be included in the Lease Receivable account? I. Guaranteed residual value. II. Unguaranteed...
Which of the following would be included in the Lease Receivable account? I. Guaranteed residual value. II. Unguaranteed residual value. III. Executory costs IV. Rental payments. Select one: a. I, II and IV b. II, III, and IV c. I and II only d. I and III only
Homework Answers
answer: a. I, II and IV
Lease Receivable account payments includes
- purchaser basic rent
- maximum recourse amount
- purchase bargain etc
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Which of the following would be included in the Lease Receivable account? I. Guaranteed residual value. II. Unguaranteed...
When a lessee is accounting for a capital (finance) lease a) a guaranteed residual value is...
When a lessee is accounting for a capital (finance) lease a) a guaranteed residual value is excluded from the “minimum lease payments.” b) an unguaranteed residual value is excluded from the “minimum lease payments.” c) a guaranteed residual value is basically an additional lease payment due at the end of the lease. d) the present value of any guaranteed residual is deducted from the leased asset cost in determining the depreciable amount. In calculating depreciation of a leased asset, the...
Choose the correct statement about an unguaranteed residual in a lease. a. the lease contract specifies...
Choose the correct statement about an unguaranteed residual in a lease. a. the lease contract specifies the amount of the unguaranteed residual b. the unguaranteed residual is not included in the lessor’s minimum lease payments but is included in the lease receivable if the lease is capitalized c. the unguaranteed residual is not a factor to be included in the lessor’s equation for purposes of computing the annual lease payment (LP) d. the unguaranteed residual is one of the factors...
For a sales-type lease, A. the sales price includes the present value of the unguaranteed residual...
For a sales-type lease, A. the sales price includes the present value of the unguaranteed residual value. B. the present value of the guaranteed residual value is deducted to determine the cost of goods sold. C. the gross profit will be the same whether the residual value is guaranteed or unguaranteed. D. none of these answers are correct.
E21.13 (LO 2,4) (Lessee-Lessor Entries, Sales-Type Lease; Guaranteed Residual Value) Phelps Company leases a building to...
E21.13 (LO 2,4) (Lessee-Lessor Entries, Sales-Type Lease; Guaranteed Residual Value) Phelps Company leases a building to Walsh, Inc. on January 1, 2020. The following facts pertain to the lease agreement. 1. The lease term is 5 years, with equal annual rental payments of $4,703 at the beginning of each year. 2. Ownership does not transfer at the end of the lease term, there is no bargain purchase option, and the asset is not of a specialized nature. 3. The building...
E21-4 (L02,4) EXCEL (Lessee Entries, Finance Lease and Unguaranteed Residual Value) Assume that on December 31,...
E21-4 (L02,4) EXCEL (Lessee Entries, Finance Lease and Unguaranteed Residual Value) Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement. 1. The agreement requires equal rental payments of $71,830 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016, is $525,176. 3. The building has an estimated economic life of 12 years,...
(Lessee Entries; Finance Lease and Unguaranteed Residual Value) Assume that on December 31, 2016, Kimberly-Clark Corp....
(Lessee Entries; Finance Lease and Unguaranteed Residual Value) Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement. 1. The agreement requires equal rental payments of $71,830 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016, is $525,176. 3. The building has an estimated economic life of 12 years, a guaranteed residual...
Exercise 15-26 Lease concepts; finance/salestype leases; guaranteed and unguaranteed residual value [LO15-2, 15-6] Each of the...
Exercise 15-26 Lease concepts; finance/salestype leases; guaranteed and unguaranteed residual value [LO15-2, 15-6] Each of the four independent situations below describes a sales-type lease in which annual lease payments of $170.000 are payable at the beginning of each year. Each is a finance lease for the lessee. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Situation 18% Lease term (years) Lessor's and...
(E21-4 L02.4) EXCEL 1-4 (L02,4) EXCEL (Lessee Entries, Finance Lease and Unguaranteed Residual Value) Assume that...
(E21-4 L02.4) EXCEL 1-4 (L02,4) EXCEL (Lessee Entries, Finance Lease and Unguaranteed Residual Value) Assume that on December 31, 2010, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement. 1. The agreement requires equal rental payments of $71.830 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016, is $525.176. 3. The building has an estimated economic life...
In computing the annual lease payments, the lessor deducts only a guaranteed residual value from the...
In computing the annual lease payments, the lessor deducts only a guaranteed residual value from the fair value of a leased asset. Select one: True False
1.Describe the following terms: (a) residual value, (b) guaranteed residual value, and (c) initial direct costs....
1.Describe the following terms: (a) residual value, (b) guaranteed residual value, and (c) initial direct costs. 2.Explain the following concepts: (a) bargain purchase option and (b) bargain renewal option. 3.What payments are included in the lease liability? 4. Describe the accounting procedures involved in applying the operating lease method by a lessee.
E21.13 (LO 2,4) (Lessee-Lessor Entries, Sales-Type Lease; Guaranteed Residual Value) Phelps Company leases a building to Walsh, Inc. on January 1, 2020. The following facts pertain to the lease agreement. 1. The lease term is 5 years, with equal annual rental payments of $4,703 at the beginning of each year. 2. Ownership does not transfer at the end of the lease term, there is no bargain purchase option, and the asset is not of a specialized nature. 3. The building...
E21-4 (L02,4) EXCEL (Lessee Entries, Finance Lease and Unguaranteed Residual Value) Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement. 1. The agreement requires equal rental payments of $71,830 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016, is $525,176. 3. The building has an estimated economic life of 12 years,...
Exercise 15-26 Lease concepts; finance/salestype leases; guaranteed and unguaranteed residual value [LO15-2, 15-6] Each of the four independent situations below describes a sales-type lease in which annual lease payments of $170.000 are payable at the beginning of each year. Each is a finance lease for the lessee. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Situation 18% Lease term (years) Lessor's and...
(E21-4 L02.4) EXCEL 1-4 (L02,4) EXCEL (Lessee Entries, Finance Lease and Unguaranteed Residual Value) Assume that on December 31, 2010, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement. 1. The agreement requires equal rental payments of $71.830 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016, is $525.176. 3. The building has an estimated economic life...
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