$5,000 se paym On January 1,2024, Lowe's Inc. entered into a lease agreement with Traveler Inc. to lease a car for 3 years. The lease is accounted for as a finance lease due at at the beginning of the period starting January 1, 2024 and on December 31 of each year thereafter. There is no residual value. The rate implicit in the lease is 8%. On December 31, 2024, what entry (or entries) will Lowe's record regarding the lease? The present value of an annuity due at 8% for 3 years is 2.78326. (Round to whole dollars) О А. OB. O D. Lease expense Lease liability Right of use asset Interest expense Lease liability Cash Amortization expense Right-of-use asset Interest expense Lease liability Amortization expense Right-of-use asset Interest expense Lease liability Cesk Debit 5,000 Debit 713 4,287 4,639 Debit 713 4,295 Debit 713 4,287 Credit 1031 3.969 Credit 5,000 4,639 Credit 713 4,295 Credit 5.000
$5,000 se paym On January 1,2024, Lowe's Inc. entered into a lease agreement with Traveler Inc. to lease a car for 3 years. The lease is accounted for as a finance lease due at at the beginning of the period starting January 1, 2024 and on December 31 of each year thereafter. There is no residual value. The rate implicit in the lease is 8%. On December 31, 2024, what entry (or entries) will Lowe's record regarding the lease? The present value of an annuity due at 8% for 3 years is 2.78326. (Round to whole dollars) О А. OB. O D. Lease expense Lease liability Right of use asset Interest expense Lease liability Cash Amortization expense Right-of-use asset Interest expense Lease liability Amortization expense Right-of-use asset Interest expense Lease liability Cesk Debit 5,000 Debit 713 4,287 4,639 Debit 713 4,295 Debit 713 4,287 Credit 1031 3.969 Credit 5,000 4,639 Credit 713 4,295 Credit 5.000
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
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 1E: Determining Type of Lease and Subsequent Accounting On January 1, 2019, Caswell Company signs a...
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![On January 1,2024, Lowe's Inc. entered into a lease agreement with Traveler Inc. to lease a car for 3 years. The lease is accounted for as a finance lease and $5,000 in lease payments are
due at at the beginning of the period starting January 1, 2024 and on December 31 of each year thereafter. There is no residual value. The rate implicit in the lease is 8%. On December 31,
2024, what entry (or entries) will Lowe's record regarding the lease? The present value of an annuity due at 8% for 3 years is 2.78326. (Round to whole dollars)
OA.
OB.
OIC.
O D.
Lease expense
Lease liability
Right of use asset
Interest expense
Lease liability
Cash
Amortization expense
Right-of-use asset
Interest expense
Lease liability
Amortization expense
Right-of-use asset
Interest expense
Lease liability
Cash
Debit
5,000
Debit
713
4,287
4,639
Debit
713
4,295
Debit
713
4,287
Credit
1031
3,969
Credit
5,000
4,639
Credit
713
4,295
Credit
5,000
A](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2c2a5a6a-1705-4081-88a0-53da8029a49c%2Fbafb2424-a137-46fa-9117-c6005a55738a%2Fwcabmik_processed.jpeg&w=3840&q=75)
Transcribed Image Text:On January 1,2024, Lowe's Inc. entered into a lease agreement with Traveler Inc. to lease a car for 3 years. The lease is accounted for as a finance lease and $5,000 in lease payments are
due at at the beginning of the period starting January 1, 2024 and on December 31 of each year thereafter. There is no residual value. The rate implicit in the lease is 8%. On December 31,
2024, what entry (or entries) will Lowe's record regarding the lease? The present value of an annuity due at 8% for 3 years is 2.78326. (Round to whole dollars)
OA.
OB.
OIC.
O D.
Lease expense
Lease liability
Right of use asset
Interest expense
Lease liability
Cash
Amortization expense
Right-of-use asset
Interest expense
Lease liability
Amortization expense
Right-of-use asset
Interest expense
Lease liability
Cash
Debit
5,000
Debit
713
4,287
4,639
Debit
713
4,295
Debit
713
4,287
Credit
1031
3,969
Credit
5,000
4,639
Credit
713
4,295
Credit
5,000
A
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