On January 1, 2019 Zhavy Co. leased office furniture from Cherry Co. under operating lease. Payments on the will be made as follows: December 31, 2019 230,000 December 31, 2020 250,000 December 31, 2021 270,000 As an inducement to enter the lease, CHERRY CO. granted ZHAVY CO. the first six months of the lease rent-free. SINAG also paid the following: Initial direct cost 100,000 Security deposit 50,000 Lease Bonus 60,000 Insurance and Maintenance cost 25,000 What amount of rental income should be reported in the income statement of CHERRY CO. for the year ended December 31, 2019?
On January 1, 2019 Zhavy Co. leased office furniture from Cherry Co. under operating lease. Payments on the will be made as follows: December 31, 2019 230,000 December 31, 2020 250,000 December 31, 2021 270,000 As an inducement to enter the lease, CHERRY CO. granted ZHAVY CO. the first six months of the lease rent-free. SINAG also paid the following: Initial direct cost 100,000 Security deposit 50,000 Lease Bonus 60,000 Insurance and Maintenance cost 25,000 What amount of rental income should be reported in the income statement of CHERRY CO. for the year ended December 31, 2019?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 1, 2019 Zhavy Co. leased office furniture from Cherry Co. under operating lease. Payments on the will be made as follows:
December 31, 2019 |
230,000 |
December 31, 2020 |
250,000 |
December 31, 2021 |
270,000 |
As an inducement to enter the lease, CHERRY CO. granted ZHAVY CO. the first six months of the lease rent-free. SINAG also paid the following:
Initial direct cost |
100,000 |
Security deposit |
50,000 |
Lease Bonus |
60,000 |
Insurance and Maintenance cost |
25,000 |
What amount of rental income should be reported in the income statement of CHERRY CO. for the year ended December 31, 2019?
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