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Intermediate Accounting: Reporting And Analysis
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 6E: Lessor Accounting Issues Ramsey Company leases heavy equipment to Terrell Inc. on March 1, 2019, on...
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Req 1 and 2 Req 3 1. The company can purchase the equipment by borrowing $233,000 with a 21-month, 12% installment note. Payments of $12,356.17 are due at the end of each month, and the first installment is due on January 31, 2024. Record the issuance of the installment note payable for the purchase of the equipment. 2. The company can sign a 21-month lease for the equipment by agreeing to pay $9,492.50 at the end of each month, beginning January 31, 2024. At the end of the lease, the equipment must be returned. Assuming a borrowing rate of 12%, record the lease. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list 1 Journal entry worksheet Req 4 2 The company can sign a 21-month lease for the equipment by agreeing to pay $9,492.50 at the end of each month, beginning January 31, 2024. At the end of the lease, thelequipment must be returned. Assuming a borrowing rate of 12%, record the lease. Note: Enter debits before credits. Date January 01, 2024 General Journal Prev Debit 1 of 4 Credit Next > Show less A
Transcribed Image Text:Req 1 and 2 Req 3 1. The company can purchase the equipment by borrowing $233,000 with a 21-month, 12% installment note. Payments of $12,356.17 are due at the end of each month, and the first installment is due on January 31, 2024. Record the issuance of the installment note payable for the purchase of the equipment. 2. The company can sign a 21-month lease for the equipment by agreeing to pay $9,492.50 at the end of each month, beginning January 31, 2024. At the end of the lease, the equipment must be returned. Assuming a borrowing rate of 12%, record the lease. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list 1 Journal entry worksheet Req 4 2 The company can sign a 21-month lease for the equipment by agreeing to pay $9,492.50 at the end of each month, beginning January 31, 2024. At the end of the lease, thelequipment must be returned. Assuming a borrowing rate of 12%, record the lease. Note: Enter debits before credits. Date January 01, 2024 General Journal Prev Debit 1 of 4 Credit Next > Show less A
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