January 1, 20x2, James Industries entered into an agreement to lease equipment to Espir alifies as a sales-type lease. James paid $210,000 for the equipment and is leasing it to Esp ount that will return 8% to James Industries. The present value of the lease payments is $2 e each January 1, beginning in 20x2. James Industries has a December 31st year-end. WH mes Industries should make on December 31, 20x2 to record interest on the lease? Multiple Choice
January 1, 20x2, James Industries entered into an agreement to lease equipment to Espir alifies as a sales-type lease. James paid $210,000 for the equipment and is leasing it to Esp ount that will return 8% to James Industries. The present value of the lease payments is $2 e each January 1, beginning in 20x2. James Industries has a December 31st year-end. WH mes Industries should make on December 31, 20x2 to record interest on the lease? Multiple Choice
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:On January 1, 20x2, James Industries entered into an agreement to lease equipment to Espinoza Moving & Storage. The lease
qualifies as a sales-type lease. James paid $210,000 for the equipment and is leasing it to Espinoza for $32,000 per year, an
amount that will return 8% to James Industries. The present value of the lease payments is $210,000. The lease payments are
due each January 1, beginning in 20x2. James Industries has a December 31st year-end. What is the appropriate journal entry
James Industries should make on December 31, 20x2 to record interest on the lease?
Multiple Choice
Interest receivable
Interest revenue
Cash
Interest revenue
16,800
16,800
< Prev
16,800
16.800
7 of 24
‒‒‒
▪▪▪▪
SAMSUNG
Next >
ő
ENG
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