he Arcade Company entered into a 10 year lease under which it made payments of R26 720 annually in advance.Arcade's borrowing rate was 10% per annum. The present value of the land was R125 000 and that of the buildings wasR125 000. The value of the land at the end of 10 years was R167 500 and the value of the buildings was R32 500. The landwould be classified as_______. Select one: a. an accounting lease b. a finance lease c. a financial lease d. an operating lease
Q: Mr. Li is employed by BDF Incorporated. Assume that in the year 2023, the Social Security base…
A: The current tax rate for social security is 6.2% and The current rate for Medicare is 1.45%
Q: E7.2 (LO 1, 2), E The following control procedures are used at Torres Company for over-the-counter…
A: Internal control refers to the set of principles, procedures, and practices companies define to…
Q: urchases (gross) eight-in les revenue les returns 628,400 31,900 1,029,400 74,600
A: a retail operation does not mention the cost of goods manufactured, as it sells the products that…
Q: hoose the correct letter in each item. Kindly answer all items. NO EXPLANATION NEEDED 1. Wages for…
A: Costing - Any system for allocating expenses to a business component is known as costing. In order…
Q: 1. Property taxes on a manufacturing plant is an element of: a. Conversion cost b. Prime cost c.…
A: Since you have posted multiple questions, we will do the first one for you. To get the other…
Q: The beginning balance sheet of Desk Source Co. included a $700,000 investment in Est stock (25%…
A:
Q: Direct Write-off Method Example: Accounts Receivable balance is $10,000 as of December 31. Customer…
A: Note: Under the Direct write-off method, bad debts expense are recorded when the company is sure…
Q: The following information on cost and net realizable value of Martinez Ltd's various inventory…
A: Journal entry is the primary step to record the transaction in the books of accounts. The increase…
Q: 25. Mike's Bikes begins business in 2022. In its first year of business, Mike sells 500 bicycles.…
A: The warranty expense is estimated on the basis of the number of units sold during the period. The…
Q: Homeowners enjoy many benefits, including a federal tax deduction for state and local property taxes…
A: Average homeowner pay in property tax Given that Median home price = $216000 The estimated…
Q: What is jens tax liability?
A: It has been given in the question that Jen is the professional as advertising account executive and…
Q: Prepare Financial Statements from the given Trial Balance. Particulars Debit Credit Cash 6,000…
A: Income statement is a financial statement that records all the income and expenses of the business…
Q: Lemon Ltd. offers executive training seminars using, in part, recorded lectures of a well-known…
A: The Break-even point is a point at which the company does not earn any profit as well as does not…
Q: Determine the costs assigned to ending inventory when costs are assigned based on the weighted…
A: Introduction:- Weighted average method is one of the inventory valuation method. which is used to…
Q: EXERCISE/2: The balance sheets of Al-Iraq Corporation as of December 31, Year 2011, and Year 2012,…
A: Statement of Cash Flow - Statement of cash flow includes inflow and outflow of cash during the…
Q: teve owns 55% and Mark owns 45% of a partnership business.
A: Purchase of an asset is capital expenditure and we debit the asset account at its purchase…
Q: Prepare a sales budget for 2022 under each plan. (Round Unit selling price answers to 2 decimal…
A: Budgeting is a process to plan how to, where and how much company should spend money for a future…
Q: essee Inc. leased equipment at an annual payment of $85,099 payable at the beginning of each year…
A: Lease - In a lease, the owner (also known as the lessor) receives payment from the user (also known…
Q: which of the following occurs if a company decreases its selling price per unit? a. net income…
A: The contribution margin is calculated as difference between sales and variable costs. The…
Q: Bryce Co. sales are $876,000, variable costs are $469,700, and income from operations is $216,000.…
A: Given, Sales = $876,000 Variable costs = $469,700 Contribution margin = Sales - Variable costs
Q: Calculate the Ending Inventory, Cost of Goods Sold, Cost of Goods Available for Sale and Gross…
A: Inventory Valuation - Inventory can be valued using three methods - a. FIFO - Under this method…
Q: Question 6 Pemiagaan Kompani manufactured 100,000 units wooden crafts in 2020 and reported the…
A: Cost of good sold is the total amount your business paid as a cost directly related to the sale of…
Q: Present and Future Values The present value of the following cash flow stream is $6,700 when…
A: The present value of a sum that will be received at a later date can be determined using the present…
Q: A computer, originally priced at $1,450, is marked down to $841. What is the percent markdown?
A: Percent markdown means the reduction in the original price by a specific percentage. It is normally…
Q: Floyd and Merriam start a partnership business on June 12, 2025. Their capital account balances as…
A: The partnership comes into existence when two or more persons agree to do the business and further…
Q: Jungkook Company reported a cash balance of P3,310,476 on December 31, 2020. The amount consists of…
A: Cash and cash equivalents are disclosed in the balance sheet under the head current assets. It…
Q: Kenda needs her manager to review the memo she wrote so that she can send it out to her clients…
A: Answer:- Email meaning:- Email, sometime also known as an electronic mail, is the process by which…
Q: Susan, Preston, and Roman are partners in a firm with the following capital account balances: Susan…
A: When the capital balance of retiring partner is settled, the difference between the capital balance…
Q: Godhi's 2024 financial statements reported the following items-with 2023 figures given for…
A: In order to determine the rate of return on total assets the net income and interest expense are…
Q: BEPS - rights issue A company has 1,000,000 shares in issue at that start of the year. During the…
A: Right Issue :— It is the issue of new shares to existing equity shareholders at lower price.…
Q: The following is a list of six control plans from this chapter or from Chapter 9 and Chapter 10.…
A: The following is the list of Control Plans: Review shipped not billed sales orders Turnaround…
Q: 25. Help me selecting the right answer. Thank you
A: Land is purchased by the Ericson, Inc. by issuing 10000 common stock with a $10 par value. Land is…
Q: Jones and Smith start a partnership on January 1 of the current year. Smith contributes $51,000…
A: The meaning of a partnership business is two or more persons bring the capital to form the business…
Q: An item was shipped from a supplier under FOB shipping point. The invoice in the amount of $2,000…
A: Cost of inventory is the cost which is incurred on the buying of the inventory. It even includes…
Q: Rodriguez and Ying start a partnership on July 1, 2025. Rodriguez contributes $4,200 cash, furniture…
A: Journal entry is the primary reporting of the day to day business transactions. These are recorded…
Q: H? Stock is credited dends is debited for $40, for $40,
A: Answer :Entry to declaration of a stock dividend Stock dividend (17000*12%*20) $40,800 Common…
Q: Equivalent Units of Production Units of production data for the two departments of Mediterranean…
A: Started and completed in November = Transferred out - Inventory in process, November 1 Units started…
Q: 15. Help me selecting the right answer. Thank you
A: When a corporation purchases its own shares , it is called Treasury Stock. Here the…
Q: Department G had 1,920 units 25% completed at the beginning of the period, 12,100 units were…
A: Equivalent units of production mean the number of units that would have been produced using the same…
Q: On December 2, 2024, Chase, Inc. purchased furniture for its new office. In payment for the…
A: The shares issued against non cash assets are to be recorded on the basis of market value of the non…
Q: June 23 Received a $48,000, 90-day, 8% note dated June 23 from Radon Express Co. on account. Page 11…
A: Notes receivable are an item on the balance sheet that represents the value of promissory notes that…
Q: The following data were taken from the records of Griggs Company for December: Cost Category Dollar…
A: A company's income may be broken down into its sales, costs, and profitability over a certain time…
Q: Intercontinental, Incorporated, uses a perpetual inventory system. Consider the following…
A: Inventory Valuation Method - Inventory Valuation can be done using three methods - a. FIFO Method b.…
Q: Carmelita Inc. has the following information available: Costs from Beginning Inventory Costs from…
A: Equivalent units for each unit completed from beginning WIP, units started and completed and…
Q: MN.18. An asset (according to the historical cost model) with a carrying amount as at December…
A: The historical cost model states that the fixed assets are reported at the original cost in the…
Q: Revenue from product X is $4,000. Total variable costs for product X are $2,500. The allocated fixed…
A: If a product is dropped then revenue from the product is lost, variable costs are saved and…
Q: nit. On November 2, the company purchased 10 units at $ nit. Then, on November 8, the company sold…
A: Answer :LIFO = Last in first out Cost of good sold = Unit sold * cost per unit
Q: Ruby and Anita are partners. Ruby has a capital balance of $240,000 and Anita has a capital balance…
A: Introduction:- Journal entry is the first stage of accounting process. Journal entry used to record…
Q: $990,000
A: Entry on issuance of Bond 1 may 2022. Cash/bank accounts dr. 990000 :to…
Q: BES-2 Prepare the journal entries to record the following transactions on Rowen Company's books: (a)…
A: Journal Entry :— It is an act of recording transaction in books of account when transaction…
The Arcade Company entered into a 10 year lease under which it made payments of R26 720 annually in advance.Arcade's borrowing rate was 10% per annum. The present value of the land was R125 000 and that of the buildings wasR125 000. The value of the land at the end of 10 years was R167 500 and the value of the buildings was R32 500. The landwould be classified as_______.
Select one:
a.
an accounting lease
b.
a finance lease
c.
a financial lease
d.
an operating lease
Step by step
Solved in 2 steps
- The Arcade Company entered into a 10 year lease under which it made payments of R26 720 annually in advance. Arcade's borrowing rate was 10% per annum. The present value of the land was R125 000 and that of the buildings was R125 000. The value of the land at the end of 10 years was R167 500 and the value of the buildings was R32 500. How much of the R26 720 annual payment would be allocated to the operating lease? Select one: O a. R14 322 O b. R9 339 O c. R13 360 O d. R13 369The Arcade Company entered into a 10 year lease under which it made payments of R26 720 annually in advance.Arcade's borrowing rate was 10% per annum. The present value of the land was R125 000 and that of the buildings wasR125 000. The value of the land at the end of 10 years was R167 500 and the value of the buildings was R32 500. What isthe present value of the operating lease?Select one:a.None of the given options is correctb.R125 000c.R64 571d.R48 188A lessor made an investment in an asset with net cost of investment of ₱800,000 and intends to lease it out for a 5-year term. He determined that he will incur an annual cost of ₱250,000. Tax rate is 25%. Annual depreciation is ₱160,000. Cost of capital is 15%. The breakeven lease per year would be? ₱ 494,450 ₱ 471,503 512,356 ₱ 323,886 ₱ 361,417 ₱ 514,876
- A freehold office was let 12 years ago at a rent of RM1,800,000 per annum (net). The lease was for 15 years subject to 5-yearly rent review pattern. The required rate of return for this type of property is 12%. Value the freehold property if the All Risk Yield is 8% and gross full rental value is RM3,200,000 using the following; a) Traditional Method of ValuationA small shop was recently let on a 6-year lease at a net r ent of $10,000 per month for the first3 years and $11,000 net per month for the remain ing years. The current market rental value of the shop s $12,000 net per month. The f eehold interest rate for a similar property is 7% and the sinking fund rate is 3% per ann um. Please advise on the capital value of the freehold and leasehold interest of the shopSmart Ltd negotiated a lease for equipment on the following terms: the lease had a 3 year term; the purchase price of the new equipment was R41 250; there were to be 3 annual payments of R15 000 payable in advance; and Smart Ltd was able to borrow at 10% per annum. The finance charge in the first year using the sum of the digits method would be Select one: O a. R2 500 O b. R4 125 O c. R15 000 O d. R1 500
- 2. ABC Realty sold a piece of land for P250,000. A down payment of P50,000 was made and the remainder is to be paid in equal semiannual installments, the first due 6 months after the date of sale. The interest is 8% compounded semiannually and the debt is to be amortized in 5 years. a. How much semiannual payment is required? b. What will the total amount of the payment be? c. How much interest will be paid? d. What is the total cost of the property? e. Prepare an amortization schedule for the present value of the loan after making the down payment.D4) Finance Cda leased plant over five years. Annual payments were £x in arrears with interest rates at 5%. Licensing fees to operate this plant cost GHI £y. Calculate the Right-of Use value of this asset in GHI’s accountsAt the beginning of current year, JadeCompany purchased a new machine forP4,800,000 and leased it to East the same day.The machine has an estimated 12-year life andwill be depreciated P400,000 per year. The leaseis for a three-year period at an annual rental ofP850,000.Additionally, East paid P300,000 to Jade as alease bonus to obtain the three-year lease. Jadeincurred insurance expense of P80,000 for theleased machine during the current year.What is the operating profit of the lessor on theleased asset for the current year?
- Darwin Limited entered into a lease agreement on 1 July 2020 for its demolition machinery. The duration of the lease is four years. The cost price of the machinery was R1 800 000. Installments of R432 649 are payable annually in arrears on 30 June. The implicit interest rate is 15% per annum. Ownership will be transferred to Darwin Limited at the end of the lease term. Darwin Limited depreciates machinery over 10 years using the straight-line method, with nil residual value. The wear and tear allowance on machinery is at a rate of 25% per annum using the straight-line method. REQUIRED: Show ONLY the following three-line items in the Statement of Financial Position as at 30 June 2021: Right of use asset Current portion of lease liability Lease liabilityCassandra Company decides to enter the leasing business. The entity acquires a specialized packaging machine for P3,000,000 cash and leases it for a period of 6 years after which the machine is to be returned to Cassandra Company for disposition. The guaranteed residual value of the machine is P200,000. The lease term is arranged so that a return of 12% is earned by Cassandra Company. What is the annual rental payable in advance required to yield the desired return?Helpful plc is a finance company. It purchased computer equipment for R78 500 and leased it to Chatroom Ltd under a three year lease with three payments of R29 000 payable annually in advance. Chatroom Ltd agreed to pay R830, which represented the cost of setting up the lease. At the end of the first year, the balance sheet reported a balance of R55 363. The implicit rate of interest is 10%. What amount will be recognised in the Helpful plc income statement as interest in the second year? Select one: a. R5 536 b. R2 636 c. R830 d. R29 000