Prepare the journal entry at commencement of the lease for Sharrer, assuming (1) Sharrer does not know Macinski's implicit rate (Sharrer's incremental borrowing rate is 9%), and (2) Sharrer incurs initial directs costs of $10,000. (Credit account titles are
Q: imah Puddleduck ance Sheet at 31 October 2012 2012 2011 ETS h in hand h at bank 25 40 450 230
A: Net worth is the amount of equity that can you get from the basic accounting equation of assets…
Q: Se 3. On December 2, Coley Corp acouired U00 shares of ts $2 par value common stock for $21 each On…
A: Treasury Stock are stock reacquired. The stock which is already sold is bought back are treasury…
Q: Portions of the financial statements for Myriad Products are provided below.
A: 1. Depreciation, patent amortization, loss on sale of land are non cash expenses . So, added…
Q: ipany rep0I end, the company had 350,000 weighted-average shares of common stock. 1. What amount of…
A: There are two type of stockholder-preferred and common. When we calculate EPS ,we deduct preferred…
Q: Given the following information: prepaid expense R12000, accrued expenses R38000, accrued income,…
A: For any business, the following equation always prevail: Assets = Liabilities + Equity
Q: Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near…
A: Budgeting is an important part of the business process. Without budgeting a business cannot track…
Q: I have the exact same question but it says that general journal entries g and j are incorrect
A: Cost bifurcation of Gymnasium Building and Value of Gym Equipment: Total Cost= $56000
Q: Given that sales are R5000000, Gross profit is R1 500 000. Therefore, cost of sales is R 2500000.…
A: The cost of sales can be calculated by deducting the gross profit from the sales revenue.
Q: We discussed the fact that most companies develop and document a capitalization policy regarding…
A: The answer is stated below:
Q: For the left columns you are prompted to use the drop down options provided in the photos. For the…
A: Factory Overhead Budget Except for direct expenses that are already covered by the direct material…
Q: Keil Company has a single investment property which had an original cost of P5,800,000 on January 1,…
A: In case of Fair value model, assets is measured at fair value and any change in fair value during…
Q: Return to question LIhe tollowing intormation applies to the questions displayed below) Patel and…
A: Budgeted output=20000 units Standard hours for budgeted output=20000*2hrs=40000 hrs Annual budgeted…
Q: Shaan and Anita are married and have two children, ages 13 and 15. Anita is a "nonworking" spouse…
A: The actuarial company are following an amount of $20,000 (the new rule) in order to compensate the…
Q: onstruction company budgeted P250,000 per year to pay for the cost of maintenance and repair of…
A: The cost decreases by the constant uniform gradient and This cost should be equivalent to the…
Q: 56,000 to a private non-opem cable contribution deduction assuming no elections to dis
A: Deductions are the certain amount of exemptions provided on the taxpayer's adjusted gross earnings.…
Q: Kristen owns activity A which produced a $20,000 passive loss in 2020. Kristen's only income in 2020…
A: Passive activity loss can be generally offset against passive income only, carryforward indefinately…
Q: If impairment exists what would be the journal entry ?
A: Impairment loss refers to the amount of loss that occurs when the carrying value of an asset is more…
Q: The percentage-of-receivables basis of estimating uncollectible accounts receivable emphasizes…
A: Accounts receivables is the amount to be received from the customers on account (Credit sales).…
Q: You decide to earn some money during the summer by running a lawn mowing service called Blade for…
A: In the context of the given question, we compute the accounts receivable balance reported on the…
Q: 1. Calculate the missing information for the purchase. Item Selling Price Sales Tax Rate Sales Tax…
A: Tax refers to the amount charged by the government on individuals, partnership firms, HUF’s or any…
Q: On January 1, 2017, Grace Company (Grace) purchased 79% of the outstanding ordinary share of Hilda…
A: NCI on Jan 1, 2017 6,63,000 Add change in retained earning from 2017 to…
Q: Which of the following statements is true regarding the calculation of a C corporation's taxable…
A: Here discuss about the treatment of taxable income for the C corporation and the details which are…
Q: On January 1, 2018, Ling Services issued $168,000 of six-year, 12% bonds when the market interest…
A: >Bonds Payable are the source of finance for the companies. >The bondholders are…
Q: Hi-Tek Manufacturing, Inc., makes two types of industrial component parts—the B300 and the T500. An…
A: An income statement is a financial report that indicates the revenue and expenses of a business. It…
Q: Excel Inc. has provided the following information relating to its sales for the past year, which…
A: The allowance for uncollectible accounts is created to record estimated bad debt expense for the…
Q: Which of the following statements is true? Partners are employees of the partnership. Salaries to…
A: The partnership comes into existence when two or more persons agree to do the business and further…
Q: Instructions The actual cash received from cash sales was $45,449 and the amount indicated by the…
A: Cash short or over= Actual cash received from cash sales - Amount indicated by cash register
Q: You plan on starting a lawn mowing business by investing $700 of your own money and purchasing $500…
A: Schedule of Cash collection First month Second month Hours worked 170 340 Rate per hour $17…
Q: Assume that in 2021, Graham Company discovered that December 31, 2019 inventory was overstated.…
A: If ending inventory is overstated then the Gross profit of that year will increase. This will…
Q: Evaluation of the performance of an Investment center should only Include financial measures. True…
A: An investment centre is a business unit in a firm that can utilizes capital to contribute direct to…
Q: All of the following would be considered "intellectual property" except: A.…
A: Intellectual property means the creation of the minds i.e. inventions, arts, designs, images,…
Q: each 10 November Purchased 410 units of stock @ £40 each 23 December Sold 100 units of stock @ £75…
A: a) Month opening stock Purchases Sales Closing stock July 150x20 =3000 150x20 =3000…
Q: The comparative balance sheet of Hirayama Industries Inc. for December 31, 20Y2 and 20Y1, is as…
A: Cash flow statement is a statement which records inflow & outflow of cash from the three main…
Q: urchased a laptop and promised to pay P2500 every month for 2 years, beginning on the date of…
A: Purchase are made but they are paid by the monthly equal payments that carry the payment for…
Q: Beched Company and its subsidiaries provided the following properties owned by the group: Land held…
A: As per IAS 40, Investment property is an asset that is held with an intention to gain rentals or…
Q: A chemical company is considering two types of incinerators to burn solid waste generated by a…
A: It is the annual cost of purchasing, operating and maintaining the asset throughout the life of the…
Q: Beatty Solutions is determining the ending cash and cash equivalents for the December 31, 2020…
A: Cash and cash equivalents states the balance sheet line items that records the company assets value…
Q: nomical bid if the interest rate is co e any salvage value after 20 years ost no Towor
A: Given as, A Equipment Cost = 112,000 Installation Cost = 25,000 Annual Maintenance Cost = 2000…
Q: Given the following data, calculate product cost per unit under absorption costing. dir labor:…
A: Formula: Product cost under Absorption costing = Direct materials + direct labor + Total variable…
Q: Record the transactions in the general Journal of Martin Tool Company. Problem 1 Martin closes its…
A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in…
Q: Corporate officers are elected by the firm’s stockholders.;True or False
A: The persons who hold high-ranking positions within a corporation are known as corporate officers.…
Q: investigative techniques used to uncover the fraud.
A: Fraud is defined as a false portrayal of the facts that cause the victim of the fraud to suffer harm…
Q: Barnum Company acquired several small companies at the end of 2018, and based On the acquisitions,…
A: Amortization: Amortization is the process of allocating an intangible immense amount of money as an…
Q: formed. The bank required Katherine, Bethany, and Charlie to personally guarantee the bank loan. The…
A: It is given that any loss, profit or debt is allocated at 1/3 rd for each person. The loan borrowed…
Q: Strand Retail Corp had the following info: Beg Inventory 2,500 units @ $40/each Purchased 4,000…
A: Since you have posted a question with multiple sub-parts, we will solve first three subparts for…
Q: If Arwind purchased 25% of the respective capital and profits and losses of Terence and Romeo for P…
A: Ratio Calculation on admission of new partner in partnership firm
Q: Cassels Corp. (a C-Corporation) generated a Net Operating Loss (NOL) in 2021 of ($80,000). Cassels…
A: In case of loss in current year, then the entity can create Deferred tax asset ,so that can be…
Q: Differential Analysis for a Discontinued Product A condensed income statement by product line for…
A: Fixed cost means the cost which does not vary with the level of output. Variable cost means the cost…
Q: Prepare the entry to record the purchase of Zweifel 12-12 (L01,2,3) (Accounting for Goodwill) On…
A: Intangible Assets: These are the long-term assets having no physical existence. However, the…
Q: How much gain or loss does Viggo recognize on the contribution?
A: A partner is the person who has the share in the partnership business that share represents the…
Macinski Leasing Company leases a new machine to Sharrer Corporation. The machine has a cost of $70,000 and fair value of $95,000. Under the 3-year, non-cancelable contract, Sharrer will receive title to the machine at the end of the lease. The machine has a 3-year useful life and no residual value. The lease was signed on January 1, 2020. Macinski expects to earn an 8% return on its investment, and this implicit rate is known by Sharrer. The annual rentals are payable on each December 31, beginning December 31, 2020.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- Use the information in RE20-3. Prepare the journal entries that Richie Company (the lessor) would make in the first year of the lease assuming the lease is classified as a sales-type lease. Assume that the lessee is required to make payments on December 31 each year. Also assume that Richie had purchased the equipment at a cost of 200,000.Use the information in RE20-3. Prepare the journal entries that Garvey Company would make in the first year of the lease assuming the lease is classified as a finance lease. Assume that Garvey is required to make payments on December 31 each year.domebo Corporation has entered into a 7 year lease for a piece of equipment. The annual payment under the lease will be $3,400, with payments being made at the beginning of each year. If the discount rate is 14%, the present value of the lease payments is closest to (Ignore income taxes.): Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided. (Round your intermediate calculations to 3 decimal places.)
- On June 30, 2018, Georgia-Atlantic, Inc. leased a warehouse facility from IC Leasing Corporation. The leaseagreement calls for Georgia-Atlantic to make semiannual lease payments of $562,907 over a three-year leaseterm, payable each June 30 and December 31, with the first payment at June 30, 2018. Georgia-Atlantic’s incremental borrowing rate is 10%, the same rate IC uses to calculate lease payment amounts. Depreciation is recordedon a straight-line basis at the end of each fiscal year. The fair value of the warehouse is $3 million.Required:1. Determine the present value of the lease payments at June 30, 2018 (to the nearest $000) that GeorgiaAtlantic uses to record the right-of-use asset and lease liability.2. What amounts related to the lease would Georgia-Atlantic report in its balance sheet at December 31,2018 (ignore taxes)?3. What amounts related to the lease would Georgia-Atlantic report in its income statement for the year endedDecember 31, 2018 (ignore taxes)?On June 30, 2018, Georgia-Atlantic, Inc. leased warehouse equipment from IC Leasing Corporation. The leaseagreement calls for Georgia-Atlantic to make semiannual lease payments of $562,907 over a three-year leaseterm, payable each June 30 and December 31, with the first payment at June 30, 2018. Georgia-Atlantic’s incremental borrowing rate is 10%, the same rate IC used to calculate lease payment amounts. IC purchased the warehouse from Builders, Inc. at a cost of $3 million. Required:1. What amounts related to the lease would IC report in its balance sheet at December 31, 2018 (ignore taxes)?2. What amounts related to the lease would IC report in its income statement for the year ended December 31,2018 (ignore taxes)?On January 1, 20x1, ABC Co. enters into a 4-year lease of office equipment. Annual rental payable at the end of each year is P12,000. As inducement in entering into the lease, the lessor makes the first 3 months of the lease as rent-free. ABC Co. opts to use the practical expedient allowed under PFRS 16 for leases of low value assets. Requirement: Provide the journal entries.
- Ludwick Steel SA, as lessee, signed a lease agreement for equipment for 5 years, beginning December 31, 2019. Annual rental payments of €40,000 are to be made at the beginning of each lease year (December 31). The interest rate used by the lessor in setting the payment schedule is 6%; Ludwick's incremental borrowing rate is 8%. Ludwick is unaware of the rate being used by the lessor. At the end of the lease, Ludwick has the option to buy the equipment for €5,000, considerably below its estimated fair value at that time. The equipment has an estimated useful life of 7 years, with no residual value. Ludwick uses the straight-line method of depreciation on similar owned equipment. Ludwick ends fiscal year at December 31. Present value of an annuity-due of 1 for 5 periods at 8% is 4.31213. Present value of an annuity-due of 1 for 5 periods at 6% is 4.46511. Present value of a single-sum of 1 for 5 periods at 8% is 0.68058. Instructions a. Prepare the journal entries that Ludwick should…On January 1, 2018, Haley Corporation sold a Machine to Quick Finance for P140,000 and immediately leased it back. The machine was carried on Haley’s books at P112,000. The term of the lease is 3 years, there is no bargain purchase option, and title does not transfer to Haley at lease-end. The lease requires three equal rental payments of P34,784 at the end of each year (first payment on January 1, 2019). The appropriate rate of interest is 6%, the machine has a useful life of 5 years, and the residual value at the end of the lease term is expected to be P56,000, none of which is guaranteed. What is the balance of lease liability (net amount) as of December 31, 2018?On January 1, 2020, Swifty Animation sold a truck to Peete Finance for $49,000 and immediately leased it back. The truck was carried on Swifty’s books at $43,000. The term of the lease is 3 years, there is no bargain purchase option, and title does not transfer to Swifty at lease-end. The lease requires three equal rental payments of $14,900 at the end of each year (first payment on January 1, 2021). The appropriate rate of interest is 5%, the truck has a useful life of 5 years, and the residual value at the end of the lease term is expected to be $14,000, none of which is guaranteed.Prepare Swifty’s 2020 journal entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to 0 decimal places, e.g. 5,265. Record journal entries in the order presented in the problem.)…
- Do the journal entries for the following transactions A lessee enters into a three-year lease and agrees to make the following annual payments at the end of each year: $10,000 in year 1, $15,000 in year 2, and $20,000 in year 3. The initial measurement of the right-of-use (ROU) asset and liability to make lease payments is $38,000 at a discount rate of 8%. At the end of the year, the lessee paid the first installement and recorded the amortisation expense and the interest expense. Amortization expense: $12,667 ($38,000/3) Interest expense: $3,038 ($38,000*.08). Lease liability: ? (You must calculate.)On June 30, 2021, Georgia-Atlantic, Inc. leased a warehouse equipment from IC Leasing Corporation. The lease agreement calls for Georgia-Atlantic to make semiannual lease payments of $648,358 over a four-year lease term, payable each June 30 and December 31, with the first payment at June 30, 2021. Georgia-Atlantic's incremental borrowing rate is 10%, the same rate IC uses to calculate lease payment amounts. Amortization is recorded on a straight-line basis at the end of each fiscal year. The fair value of the equipment is $4.4 million. Required:1. Determine the present value of the lease payments at June 30, 2021 that Georgia-Atlantic uses to record the right-of-use asset and lease liability.2. What pretax amounts related to the lease would Georgia-Atlantic report in its balance sheet at December 31, 2021?3. What pretax amounts related to the lease would Georgia-Atlantic report in its income statement for the year ended December 31, 2021?On January 1, 2017, Irwin Animation sold a truck to Peete Finance for $35,000 and immediately leased it back. The truck was carried on Irwin’s books at $28,000. The term of the lease is 3 years, there is no bargain purchase option, and title does not transfer to Irwin at lease-end. The lease requires three equal rental payments of $8,696 at the end of each year (first pay- ment on January 1, 2018). The appropriate rate of interest is 6%, the truck has a useful life of 5 years, and the residual value at the end of the lease term is expected to be $14,000, none of which is guaranteed. Prepare Irwin’s 2017 journal entries. Assume the same facts as above, except the lease term is now 5 years and the five annual rental payments are $8,309, with no expected residual value at the end of the lease term. Prepare Irwin’s 2017 journal entries assuming these new facts.