46. 2:40 O C O0.30KB/sProblem 3On January 1, 2020, YANIG Company entered into an 8-year noncancelable lease ofmachinery to SIKLAB. The machine had a cost of P 10,500,000. The lease is properly classifiedas direct financing lease.Equal annual rental payments under the lease are P 1,800,000 and are due on January 1 ofeach year starting January 1, 2020. The implicit interest rate of the lease is 12%.The contract includes a provision that SIKLAB will guarantee a P 1,200,000 residual value ofthe asset at the end of lease term.On January 1, 2020, YANIG paid an initial direct cost of P 200,000 in negotiating and securingthe leasing arrangement.What is the unearned interest income at YANIG's December 31, 2020 statement of financialposition?II

Lessor - YANIG Company Leasee- SIKLAB Machine Cost 10500000 Lease Payment ( paid the…

Answered: What is the unearned interest income at…

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What is the unearned interest income at YANIG's December 31, 2020 statement of financial position?

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter10: Long-term Liabilities

Section: Chapter Questions

Problem 10.7E

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H 22 A finance lease for 6 years has an annual payment in arrears of R24,000. The fair value of the lease at inception was R106,000. Using the sum of digits method, the liability for the lease at the end of year 2 is: Select one: a. R3 221 b. R3 700 c. R3 551 d. R3 461
54 Oscar, Inc., leased equipment from Reynolds Company on January 1, 2023. Reynolds manufactured theequipment at a cost of $200,000. The equipment has a fair value of $260,000.Information related to the lease appears below:Lease term 5 yearsFirst lease payment January 1, 2023Subsequent lease payments December 31, 2023, 2024, 2025, 2026Economic life of the equipment 6 yearsEstimated value of equipment at end ofeconomic life $0Purchase option, reasonably expectedto be exercised by Oscar $20,000Implicit and incremental borrowing rate 8% 3. Prepare the entries to record the lease and the first payment for both the lessee and the lessor onJanuary 1, 2023
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20. On June 30, 2021, Fly-By-Night Airlines leased a jumbo jet from Boeing Corporation. The terms of the lease require Fly-By-Night to make 20 annual payments of $1,700,000 on each June 30. Generally accepted accounting principles require this lease to be recorded as a liability for the present value of scheduled payments. Assume that a 7% interest rate properly reflects the time value of money in this situation. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required:1. At what amount should Fly-By-Night record the lease liability on June 30, 2021, assuming that the first payment will be made on June 30, 2022?2. At what amount should Fly-By-Night record the lease liability on June 30, 2021, before any payments are made, assuming that the first payment will be made on June 30, 2021?
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