On January 1, 2019, Pharoah Inc., a construction company, leased an excavator from Leaselt Inc. The lease terms are as follows: Annual lease payments of $27,900 at the beginning of each year for five years At the end of the lease term the asset reverts back to the lessor and the residual value guarantee is $11,900 The incremental borrowing rate is 8% and the implicit rate in the lease is 7% (known by the lessee) Pharoah Inc. has a December 31 year end Prepare the journal entries for 2019 for Pharoah Inc. Assume Pharoah follow IFRS. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to O decimal places, e.g. 5,275. Round factor values to 5 decimal places, e.g. 1.25124. If no entry is required, select "No entry" for the account titles and enter O for the amounts.)

On January 1, 2019, Pharoah Inc., a construction company, leased an excavator from Leaselt Inc. The lease terms are as follows: Annual lease payments of $27,900 at the beginning of each year for five years At the end of the lease term the asset reverts back to the lessor and the residual value guarantee is $11,900 The incremental borrowing rate is 8% and the implicit rate in the lease is 7% (known by the lessee) Pharoah Inc. has a December 31 year end Prepare the journal entries for 2019 for Pharoah Inc. Assume Pharoah follow IFRS. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to O decimal places, e.g. 5,275. Round factor values to 5 decimal places, e.g. 1.25124. If no entry is required, select "No entry" for the account titles and enter O for the amounts.)

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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