August 1, 2021, PAC Aviation leased two helicopters from Fast Aircraft for an initial period of 12 months with a provision for a continuation of a month-to-month basis. The lease is properly classified as an operating lease. Lease payments are to be made as follows: • 1st two months- P15,000 per month • Next three months - P12,000 per month • Next three months - P10,000 per month • Last four months - P7,500 per month After the first year, the rent continues at P6,000 per month. hat are the amounts reported in PAC Aviation’s financial statements for the year 2021? A. Rent revenue of P52,500 and Rent receivable of P13,500 B. Rent revenue of P52,500 and Unearned rent of P13,500 C. Rent revenue of P66,000 and Rent receivable of P13,500 D. Rent revenue of P66,000 and Unearned rent of P13,500
August 1, 2021, PAC Aviation leased two helicopters from Fast Aircraft for an initial period of 12 months with a provision for a continuation of a month-to-month basis. The lease is properly classified as an operating lease. Lease payments are to be made as follows: • 1st two months- P15,000 per month • Next three months - P12,000 per month • Next three months - P10,000 per month • Last four months - P7,500 per month After the first year, the rent continues at P6,000 per month. hat are the amounts reported in PAC Aviation’s financial statements for the year 2021? A. Rent revenue of P52,500 and Rent receivable of P13,500 B. Rent revenue of P52,500 and Unearned rent of P13,500 C. Rent revenue of P66,000 and Rent receivable of P13,500 D. Rent revenue of P66,000 and Unearned rent of P13,500
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 6P: Sales-Type Lease with Unguaranteed Residual Value Lessor Company and Lessee Company enter into a...
Related questions
Question
On August 1, 2021, PAC Aviation leased two helicopters from Fast Aircraft for an initial period of 12 months with a provision for a continuation of a month-to-month basis. The lease is properly classified as an operating lease. Lease payments are to be made as follows:
• 1st two months- P15,000 per month
• Next three months - P12,000 per month
• Next three months - P10,000 per month
• Last four months - P7,500 per month
After the first year, the rent continues at P6,000 per month.
hat are the amounts reported in PAC Aviation’s financial statements for the year 2021?
A. Rent revenue of P52,500 and Rent receivable of P13,500
B. Rent revenue of P52,500 and Unearned rent of P13,500
C. Rent revenue of P66,000 and Rent receivable of P13,500
D. Rent revenue of P66,000 and Unearned rent of P13,500
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning