1. On August 1, 2021, DASHER Company leased a machine to SANTA Company for a 6-year period requiring payments of P100,000 at the end of each year. The machine cost P480,000, with an economic life of eight years and no residual value. DASHER's implicit interest rate is 10% and present value factors are as follows: Present value of annuity due of P1 at 10% for 6 periods – 4.791; Present value of an annuity of P1 at 10% for 8 periods – 5.868. DASHER recorded the lease as a direct financing lease. At the inception of the lease, how much should the gross lease receivable account balance be? *
1. On August 1, 2021, DASHER Company leased a machine to SANTA Company for a 6-year period requiring payments of P100,000 at the end of each year. The machine cost P480,000, with an economic life of eight years and no residual value. DASHER's implicit interest rate is 10% and present value factors are as follows: Present value of annuity due of P1 at 10% for 6 periods – 4.791; Present value of an annuity of P1 at 10% for 8 periods – 5.868. DASHER recorded the lease as a direct financing lease. At the inception of the lease, how much should the gross lease receivable account balance be? *
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 10MC: On August 1, 2019, Kern Company leased a machine to Day Company for a 6-year period requiring...
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Mortgages
A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.
Mortgage
The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.
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