East Company leased a new machine from North Company on May 1, 2014, under a lease with the following information: East has the option to purchase the machine on May 1, 2024, by paying $50,000, which approximates the expected fair value of the machine on the option exercise date. Required: What is the amount of the capitalized leased asset on May 1, 2014?
East Company leased a new machine from North Company on May 1, 2014, under a lease with the following information: East has the option to purchase the machine on May 1, 2024, by paying $50,000, which approximates the expected fair value of the machine on the option exercise date. Required: What is the amount of the capitalized leased asset on May 1, 2014?
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
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 11P
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Question
East Company leased a new machine from North Company on May 1, 2014, under a lease with the following information:
East has the option to purchase the machine on May 1, 2024, by paying $50,000, which approximates the expected fair value of the machine on the option exercise date.
Required:
What is the amount of the capitalized leased asset on May 1, 2014?
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