On August 1, 2012, Mimi Company leased a machine to DartCompany for a six-year period requiring payments of P100,000 at the beginning of each year. The machine cost P480,000, which is the fair value at the lease date, and has a useful life of eight years with no residual value. Gabriel's implicit interest rate is 10% and present value factors are rounded off to three decimal places. Gabriel appropriately recorded the lease as a direct financing lease. At the inception of the lease, the lease receivables account balance should be a. P600,000 b. P586,800 c. P480,000 d. P479,100 Use the same information given in above. How much is the interest revenue relating to the lease for the year ended December 31, 2012? a. P48,000 b. P35,417 c. P25,000 d. P15,833 e. P38,000
On August 1, 2012, Mimi Company leased a machine to DartCompany for a six-year period requiring payments of P100,000 at the beginning of each year. The machine cost P480,000, which is the fair value at the lease date, and has a useful life of eight years with no residual value. Gabriel's implicit interest rate is 10% and present value factors are rounded off to three decimal places. Gabriel appropriately recorded the lease as a direct financing lease. At the inception of the lease, the lease receivables account balance should be a. P600,000 b. P586,800 c. P480,000 d. P479,100 Use the same information given in above. How much is the interest revenue relating to the lease for the year ended December 31, 2012? a. P48,000 b. P35,417 c. P25,000 d. P15,833 e. P38,000
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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On August 1, 2012, Mimi Company leased a machine to DartCompany for a six-year period requiring payments of P100,000 at the beginning of each year. The machine cost P480,000, which is the fair value at the lease date, and has a useful life of eight years with no residual value. Gabriel's implicit interest rate is 10% and present value factors are rounded off to three decimal places. Gabriel appropriately recorded the lease as a direct financing lease. At the inception of the lease, the lease receivables account balance should be
a. P600,000
b. P586,800
c. P480,000
d. P479,100
Use the same information given in above. How much is the interest revenue relating to the lease for the year ended December 31, 2012?
a. P48,000
b. P35,417
c. P25,000
d. P15,833
e. P38,000
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