In a 5-year finance lease, the amortization expense of the right-of-use asset in the third year is: A) the same as in the fourth year. B) zero. C) less than in the fourth year. D) more than in the fourth year.
Q: 5. The accounting department of Mafe Café provided the following data for 2021: Sales Marketing expe...
A: A cost sheet is a statement that shows accumulated costs associated with a product or production. It...
Q: a) Calculate the contribution margin per unit. b) Calculate the number of units Beauty Supplies Comp...
A: hjvkbb kllnlllm bkjlnlk
Q: The expected income each year from the new shelving products is: Win Corporation is considering the ...
A: Answer) P 52,500 Answer) P 52,500 Calculation of income statement ...
Q: for the Compute following (show your solution): 1. Total Current Assets 2. Total Non-current Assets ...
A: 2. Balance Sheet - This Statement shows the balance of assets liabilities and Equity as at the balan...
Q: Reuben Company retires a machine from active use on January 2, 2019, for the express purpose of leas...
A: Solution Net income refer to the amount an individual and business makes after deducting costs , a...
Q: In the audit of the Property, Plant and Equipment account of Bim Co., you have noticed that the depr...
A: Change in Depreciation Method: When there is a major change in the pattern of future economic advant...
Q: A company is currently using a machine, which has 5 years of remaining life and the annual operating...
A: Introduction:- Operating costs, often known as operational expenditures, are expenses connected to t...
Q: Wages Payable were P3,500 at the end of September and P2,800 at the end of October. Wages Expense fo...
A: Wages expense is the amount of expense incurred for the payment of labor.
Q: equipment this month is $300. The necessary adjusting entry will include
A: Solution: Adjusting entries are those entries which are made to match the revenues or expenses to th...
Q: Directions: Identify the accounting principles that are being violated in the situation below. 7. ES...
A: Ans. Accounting principles are the basis or rules which need to be followed while preparing the book...
Q: ne 30, 201g, Roddick Company had a cash balance in its general ledger of $11,595. The company's bank...
A: Solution: A bank reconciliation is the internal control system by which the bank account balance in ...
Q: Bond X and bond Y both are issued by the same company. Each of the bonds has a face value of $100,00...
A: The issue price of Bonds is equal to the present value of all coupon payments and maturity value dis...
Q: Required: How much total overhead cost would be assigned to K425 and M67
A: Answer Activity Cost Pool K425 M67 Supporting direct labor $480 ($6 * 80) $3,000 ($6 * 500)...
Q: On January 1, 2019, Ballieu Company leases specialty equipment with an economic life of 8 years to A...
A: The question is based on the concept of Lease Accounting in Financial Accounting.
Q: ght finances. Lillian did nc e, Lillian, withdrew $20,0C t and Lyle is the contribut e $20,000 withd...
A: Tax refers to the percentile charge levied by the government over the income gained by an entity.,
Q: Compute the firm’s predetermined overhead rate, which is based on direct-labour hours. b) Calculate...
A: "Since you have posted a question with multiple sub-parts, we will solve first three sub parts for y...
Q: engaged in renting out 250 apartment units to small families for P13,000 per month. All units are oc...
A: Tax refers to the percentile charges levied by the government over the income gained by an entity.
Q: 1. How much is overstatement(understatement) of the retained earnings by the end of 2019? (if UNDER,...
A: Retained Earnings The purpose of keeping retained earning is to reserve the amount of profit which a...
Q: The underlying evidences for intangibles which includes purchase agreements, patent certificates, fr...
A: A permanent file is a set of records used in future as a reference for an organization's external au...
Q: Cash Effective Decrease in Outstanding Date interest interest balance balance 1/1/2021 $ 207,020 6/3...
A: Formula: Effective Int rate = Interest / Outstanding balance x 100
Q: Assume Jack and Jill, 25 and 75 percent shareholders, respectively, in UpAHill Corporation, have tax...
A: Tax is the amount that is charged by the government from the organization and individuals on the inc...
Q: The following balances were reported by Nagpapangap Company on December 31, 2020 and 2019: 2020: Acc...
A: Gross Purchase refers to Total Purchase it including cost of goods returned and Discounts also. Unde...
Q: THE SMITH COMPANY Using the business transactions below, complete T-accounts for the Smith Company. ...
A: answers CASH ACCOUNT HEADS DEBIT CREDIT BALANCE CAPITAL 120,000 12...
Q: How much is the gain (loss) as a result of the sale of the building?
A: The answer for the multiple choice question and relevant working are presented hereunder : Cost of b...
Q: 2. Mala-Inse Company needs P5,000,000 short-term credit for 90 days. To produce the amount, the comp...
A: The fees and other expenses spent by the Corporation when borrowing funds are referred to as financi...
Q: 36... Teal Leasing Company agrees to lease equipment to Flint Corporation on January 1, 2020. The f...
A: Lease is a form of agreement between two parties, in which one party provides it's asset for use to ...
Q: When a lease qualifies as a finance lease, what amount is initially recorded as the cost of the righ...
A: Solution Concept In case of finance lease , The initial cost of right of use asset include Prese...
Q: Ivanhoe Engineering Corporation purchased conveyor equipment with a list price of $45,200. Three ind...
A: answers 1. The vendor credit terms are 1/10 net 30 which means discount of 1% will be available i...
Q: The shareholders' equity section of ABC Corporation as at Dec 31, 2021 appeared as follows: 6% Prefe...
A: a. Issue price of preference shares = shares issued x P75 =70000 x 75 = P 5250000 b. Ordinary shares...
Q: QUESTION 14 Florist Gump, Inc. purchased land at a cost of $5,000 on February 2, 2000. At December 3...
A: Solution: As per historical cost concept, Non current assets are generally reported at their cost in...
Q: person to start a project 8 years ago placed a deposit of ¢ 1,500,000.00 in a financial institution ...
A: Solution Given Life of project 8 years Initial deposit 1500000 First 3 years 5% mo...
Q: Sasha started a RESP five years ago for her son Ivan who is now 17 years of age. In 2016, 2017 and 2...
A: Canada Education Savings Grant(CESG) It is a grant from the Government of Canada which is directly ...
Q: QUESTION 15 During the year, Proffitts, Inc., had revenue of $83,000 and expenses of $26,000. During...
A: Revenue = $83000 Expenses = $26000
Q: a) Prepare the entries in a journal and then post to the T accounts. b) Total the T accounts and pre...
A: As per our protocol we provide solution to the first three sub-parts only but you have asked multipl...
Q: the interest rate on debt is lower than ROA, then a firm will __________ by increasing the use of de...
A: Solution Return on Equity is a measure of financial performance calculated by dividing net income ...
Q: What does the expression “marginal product of labour” mean ? Why do workers (skilled and unskilled) ...
A: marginal product of labour is concept of economics. this concept is generally used in economics when...
Q: Estrada V. Escritor sells on terms 3/10, net 30. Total sales for the year are ₱2,539,130. Forty per...
A: The average amount of receivable can be calculated by multiplying the average receivable per day by ...
Q: Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. In the conditions list...
A: Given Information :- Winkin, Blinkin, and Nod are equal shareholders in SleepEZ. Timing and income o...
Q: a) In your own words, explain how do we account for service costs included within a contract to leas...
A: Disclaimer: “Since you have asked multiple question, we will solve the first question for you. If yo...
Q: Liabilities* return on assets current ratio asset turnover AR turnover
A: The ratio analysis helps to analyse the financial statements of the business.
Q: 9.Hong Kong Clothiers reported revenue of $5,150,000 for its year ended December 31, 2021. Accounts ...
A: Formula: Cash collections from customers = December 31, 2021 revenue - December 31, 2021 receivables...
Q: Happy Trails has the following information for its manufacturing: Direct Materials $16 Direct Labor ...
A: The income statement is prepared to find net income or losses incurred during the period.
Q: Pixel Studio, Incorporated, is a small company that creates computer-generated animations for films ...
A: Solution 1: Computation of cost of serving Local commercial market Particulars Amount Animat...
Q: Assume the following adjustment data and prepare the adjusting entries.
A: The journal entries are prepared to keep the record of day to day transactions of the business. The...
Q: Assume that DBP Leasing Corp. and Minasugbo Inc. sign a lease contract effective on January 1, 2019 ...
A: DBP leasing leases to Minasugbo a bulldozer. Therefore, Lessor= DBP leasing Lessee= Minasugbo The r...
Q: The cost of goods sold was computed at P12.250. Teotal sales for the year were P42950. of which P31....
A: Formula: Inventory turnover ratio = Cost of goods sold / Average Inventory
Q: sume the following independent cases: A. At the beginning of the year, a check was issued for P400,...
A: Answer AMOUNT CASE A The cost of Land will be Cheque issued ...
Q: Journalize the entries to record the following selected transactions
A: The chart of accounts as mentioned in the question is not provided herewith. Journal entries are the...
Q: Problem 2 ABM Enterprise would like to evaluate/analyze an investment proposal. Siven the following:...
A: The Net Present Value: Managers constantly use capital budgeting tools to assess prospective investm...
Q: objective of Managerial Accounting?
A: Managerial accounting is the system in which the method of accounting provides such statements or re...
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- 3. For a finance lease, the lease obligation of the lessee would be reduced periodically by a. the lease payment less the portion allocable to interest. b. the lease payment plus the interest expense for the period. c. the lease payment less depreciation expense if the lessee records depreciation. d. the lease payment less the amortization if the initial lease liability is more than the face amount, or plus the amortization if the initial lease liability is less than the face amount. e. none of the above.3. For a finance lease, the lease obligation of the lessee would be reduced periodically by a. the lease payment less the portion allocable to interest. b. the lease payment plus the interest expense for the period. c. the lease payment less depreciation expense if the lessee records depreciation. d. the lease payment less the amortization if the initial lease liability is more than the face amount, or plus the amortization if the initial lease liability is less than the face amount. e. none of the above. 4. Initial direct costs incurred by the lessor in connection with specific leasing activities as in negotiating and securing leasing arrangements in a direct finance lease would * a. result to an increase of the implicit interest rate. b. result to a decrease of the implicit interest rate. c. result to either an increase or a decrease of the implicit interest rate depending on the given facts. d. be ignored if the lease qualifies as a dealer's lease.The interest expense of the lessee during the year when payment is made in advanced shall be: O Lease liability at inception of the lease multiplied by implicit rate of interest. O Total present value of lease liability after initial payment multiplied by effective rate of interest. O Cost of ROUA plus PV of restoration cost multiplied by implicit rate of interest. O Annul lease payment divided by implicit rate of interest multiplied by effective rate.
- A active lease involves obligations that are not evenly distributed over the lease period. That the very first year's rent is $14,000, with a total payment of $120,000 throughout the four lease period. Interest expenditure for the first year is $6,000, relating to the current value of the entire lease payments and the implicit interest rate. For the first year, the right-to-use asset should be amortised as follows: Multiple-choice questions $0 $8,000 $20,000 $24,000Each of the three independent situations below describes a finance lease in which annual lease payments are payable at the end of each year. The lessee is aware of the lessor’s implicit rate of return. (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.) Situation 1 2 3 Lease term (years) 12 20 3 Lessor's rate of return (known by lessee) 10% 8% 11% Lessee's incremental borrowing rate 11% 9% 10% Fair value of lease asset $650,000 $1,005,000 $210,000 Required:a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease liability, for each of the above situations. (Round your answers to the nearest whole dollar.)In a ten-year finance lease, the portion of the annual lease payment in the lease's third year that represents interest is: Multiple Choice More than in the second year. The same as in the fourth year. The same as in the first year. Less than in the second year.
- Each of the four independent situations below describes a finance lease in which annual lease payments are payable at the beginning of each year. The lessee is aware of the lessor's implicit rate of return. (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.) Lease term (years) Lessor's rate of return Fair value of lease asset Lessor's cost of lease asset Residual value: Estimated fair value. Guaranteed fair value Situation 1 Situation 2 Situation 3 Situation 4 Lease Payments Residual Value Guarantee $ 1 5,000 0 0 2 6 10% $58,000 $358,000 $83,000 $58,000 $358,000 $53,000 $ PV of Lease Payments Situation 9 11% $ 58,000 0 Required: a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease liability, for each of the above situations. (Round your answers to the nearest whole dollar amount.) 58,000 3 7 9% 4 PV of…Each of the three Independent situations below describes a finance lease in which annual lease payments are payable at the beginning of each year. The lessee is aware of the lessor's implicit rate of return. (FV of $1, PV of $1, EVA of $1, PVA of $1, EVAD of $1 and PVAD of $1) (Use approprlate factor(s) from the tables provided.) Situation 1 2 Lease term (years) Lessor's rate of return (known by lessee) Lessee's incremental borrowing rate Fair value of lease asset 10 20 11% 9% 12% 12% 10% 11% $720,000 $1,100,000 $305,000 Requlred: a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease llability, for each of the above situatlons. (Round your answers to the nearest whole dollar.) Right of-use Asset/Lease Payable Lease Payments Situation 1 Situation 2 Situation 3Each of the three independent situations below describes a finance lease in which annual lease payments are payable at the end of each year. The lessee is aware of the lessor's implicit rate of return. (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.) Lease term (years) Lessor's rate of return (known by lessee) Lessee's incremental borrowing rate Fair value of lease asset Situation 1 Situation 2 Situation 3 Answer is not complete. Right-of-use Asset/Lease Payable Lease Payments $ Required: a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease liability, for each of the above situations. (Round your answers to the nearest whole dollar.) 144,513 1 9 85,177 12% 10% $770,000 Situation 2 20 10% 11% $1,065,000 4 10% 9% $270,000
- Each of the three independent situations below describes a finance lease in which annual lease payments are payable at the end of each year. The lessee is aware of the lessor's implicit rate of return. (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.) Lease term (years) Lessor's rate of return (known by lessee) Lessee's incremental borrowing rate Fair value of lease asset 1 10 Situation 1 Situation 2 Situation 3 Situation 2 20 10% 11% $730,000 $1,045,000 8% 9% 3 5 12% 11% $250,000 Required: a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease liability, for each of the above situations. (Round your answers to the nearest whole dollar.) Lease Payments Right-of-use Asset/Lease PayableEach of the three independent situations below describes a finance lease in which annual lease payments are payable at the beginning of each year. The lessee is aware of the lessor's implicit rate of return. (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.) Lease term (years) Lessor's rate of return (known by lessee) Lessee's incremental borrowing rate Fair value of lease asset 1 10 10% 11% $750,000 Situation 1 Situation 2 Situation 3 Situation 2 20 8% 9% $1,130,000 3 5 11% 10% $335,000 Required: a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease liability, for each of the above situations. (Round your answers to the nearest whole dollar.) Lease Payments Right-of-use Asset/Lease PayableEach of the three independent situations below describes a finance lease in which annual lease payments are payable at the end of each year. The lessee is aware of the lessor's implicit rate of return. (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.) Lease term (years) Lessor's rate of return (known by lessee) Lessee's incremental borrowing rate Fair value of lease asset Situation 1 Situation 2 Situation 3 $ $ $ X Answer is not complete. Lease Payments Required: a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease liability, for each of the above situations. (Round your answers to the nearest whole dollar.) 4,769,583 X 8,816,264 X 729,076 x 1 12 10% 11% $700,000 Right-of-use Asset/Lease Payable Situation 2 15 8% 9% $1,030,000 3 4 11% 10% $235,000