1Record the beginning of the lease for Baillie Power.2 Record the quarterly lease payment made by BailliePower.3 Record the quarterly lease payment made by BailliePower.4 Record amortization of the right-of-use asset for BailliePower.5 Record the quarterly lease payment made by BailliePower.6 Record amortization of the right-of-use asset for BailliePower.7 Record the quarterly lease payment made by BailliePower.8 Record amortization of the right-of-use asset for BailliePower.9 Record the quarterly lease payment made by BailliePower.10 Record amortization of the right-of-use asset for BailliePower.Note := journal entry has been enteredRecord entryClear entryΤΤΤΤ1ViewC Baillie Power leased high-tech electronic equipment from Courtney Leasing on January 1, 2021. Courtney purchased the equipmentfrom Doane Machines at a cost of $252,000, its fair value. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Useappropriate factor(s) from the tables provided.)Related Information:Lease termQuarterly lease paymentsEconomic life of assetInterest rate charged by the lessorRequired:Prepare a lease amortization schedule and appropriate entries for Baillie Power from the beginning of the lease through December 31,2021. December 31 is the fiscal year end for each company. Appropriate adjusting entries are recorded at the end of each quarter.Complete this question by entering your answers in the tabs below.AmortScheduleGeneralJournal01/01/202103/31/202106/30/202109/30/202112/31/202103/31/202206/30/202209/30/2022TotalPrepare a lease amortization schedule. (Round your intermediate calculations and final answers to the nearest whole dollar.Enter all amounts as positive values.)Payment Date2 years (8 quarterly periods)$17,000 at Jan. 1, 2021, and at Mar. 31, June 30, Sept. 30, and Dec. 31thereafter5 years12%LeasePaymentsEffectiveInterestDecrease inBalanceLease Balance

A lease is an arrangement where a lessor agrees to allow a lessee to control the use of the asset…

ecord the beginning of the lease for Baillie Power. ecord the quarterly lease payment made by Baillie ower. ecord the quarterly lease payment made by Baillie ower. ecord amortization of the right-of-use asset for Baillie ower. ecord the quarterly lease payment made by Baillie ower. ecord amortization of the right-of-use asset for Baillie ower. ecord the quarterly lease payment made by Baillie ower. ecord amortization of the right-of-use asset for Baillie ower. ecord the quarterly lease payment made by Baillie ower.

ecord the beginning of the lease for Baillie Power. ecord the quarterly lease payment made by Baillie ower. ecord the quarterly lease payment made by Baillie ower. ecord amortization of the right-of-use asset for Baillie ower. ecord the quarterly lease payment made by Baillie ower. ecord amortization of the right-of-use asset for Baillie ower. ecord the quarterly lease payment made by Baillie ower. ecord amortization of the right-of-use asset for Baillie ower. ecord the quarterly lease payment made by Baillie ower.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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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. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Situation 1 Lease term (years) Lessor's rate of return Fair value of lease asset $ 61,000 $361,000 $86,000 Lessor's cost of lease asset$ 61,000 $361,000 $ 56,000 Residual value: $61,000 Estimated fair value Guaranteed fair value 4 10% 3 0 0 4 7 11% 5 9% 8 12% $ 476,000 $ 476,000 $18,000 $ 30,000 0 $ 18,000 $ 35,000 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. Note: Round your answers to the nearest whole dollar amount.
Owefix a. compute the amount of lease receiveable for the leaseb. discusd the bethre of the leasec. prepara an amoritization table for the lessee and lessor
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Each of the four independent situations below describes a sales-type lease in which annual lease payments of $17,500 are payable at the beginning of each year. Each is a finance lease for the lessee. Lease term (years) Asset's useful life (years) Lessor's implicit rate (known by lessee) Residual value: Guaranteed by lessee. Unguaranteed Purchase option: After (years) Exercise price Determine the following amounts at the beginning of the lease: Note: Round your final answers to nearest whole dollar. A. The lessor's: 1. Total lease payments 2. Gross investment in the lease 3. Net investment in the lease B. The lessee's: 4. Total lease payments 5. Right-of-use asset 6. Lease liability $ 1 70,000 2 Situation 1 70,000 4 4 8% $0 $0 none 3 2 70,000 Situation 4 Reasonably certain? Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) 8% $ 7,000 $0 4 $ 8,500 no 4 5 8% $3,500 $ 3,500 $ 2,500 no 4 4 7 8% $0 $ 7,000 3 $ 4,500 yes
See attached picture C) What expenses related to this lease will Evans incur during the first year of the lease, and how will they be determined?
How will a 20-year lease obligation appear on the lessee's statement of financial position? a.as a long-term liability, only if an operating lease b.as a long-term liability, only if a finance lease c.as a long-term liability for any lease, operating or finance d.as a long-term asset for an operating lease
E1.
Each of the four independent situations below describes a finance lease in which annual lease payments are pay- able at the beginning of each year. The lessee is aware of the lessor's implicit rate of return. Situation 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 1 4 10% $50,000 $50,000 0 2 7 11% $350,000 $350,000 $ 50,000 0 3 5 9% $75,000 $45,000 $7,000 $7,000 Required: For each situation, determine: a. The amount of the annual lease payments as calculated by the lessor. b. The amount the lessee would record as a right-of-use asset and a lease liability. 4 8 12% $465,000 $465,000 10 $ 45,000 $ 50,000
Each of the four independent situations below describes a sales-type lease in which annual lease payments a at the beginning of each year. Each is a finance lease for the lessee. (FV of $1, PV of $1, FVA of $1, PVA of $1, $1) (Use appropriate factor(s) from the tables provided.) Situation 1 2 3 Lease term (years) 7 7 8 Lessor's and lessee's interest rate Residual value: 8 128 98 11% 10% Estimated fair value 0 $50,000 $8,000 $50,000 Guaranteed by lessee 0 0 $8,000 $60,000 Determine the following amounts at the beginning of the lease. (Round your intermediate and final answers dollar amount.) Situation 2 A The lessor's: 1. Lease payments 2. Gross investment in the lease 3. Net investment in the lease The lessee's: 4. Lease payments 5. Right-of-use asset 6. Lease payable B
None
The following facts pertain to a non-cancelable lease agreement between Faldo Leasing Company and Pharoah Company, a lessee. Commencement date Annual lease payment due at the beginning of each year, beginning with January 1, Residual value of equipment at end of lease term, guaranteed by the lessee Expected residual value of equipment at end of lease term Lease term Economic life of leased equipment Fair value of asset at January 1, Lessor's implicit rate Lessee's incremental borrowing rate January 1, $126,840 $55,000 $50,000 6 years 6 years $653,000 9 % 9 % The asset will revert to the lessor at the end of the lease term. The lessee uses the straight-line amortization for all leased equipment.
A.4.