On January 1, 2021, the lessee company signed an operating lease to lease a building from the lessor. The lease arrangement is for 8 years. Lease payments are $168,000 per year and are made at the beginning of the year. The lessee incurred initial direct costs of $65,000. Assume the following is the partial Lease Amortization Schedule (with only two rows and three columns shown) prepared by the lessee company: Date Annual Payment Interest on Liability 1/1/2022 168,000 40,000 1/1/2023 168,000 36,000 In the journal entry made on December 31, 2022, the lessee company should debit/credit Right-of-Use Asset by $___________. (Just enter the amount. Do not put a plus or minus sign in front of the amount.)
On January 1, 2021, the lessee company signed an operating lease to lease a building from the lessor. The lease arrangement is for 8 years. Lease payments are $168,000 per year and are made at the beginning of the year. The lessee incurred initial direct costs of $65,000. Assume the following is the partial Lease Amortization Schedule (with only two rows and three columns shown) prepared by the lessee company: Date Annual Payment Interest on Liability 1/1/2022 168,000 40,000 1/1/2023 168,000 36,000 In the journal entry made on December 31, 2022, the lessee company should debit/credit Right-of-Use Asset by $___________. (Just enter the amount. Do not put a plus or minus sign in front of the amount.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On January 1, 2021, the lessee company signed an operating lease to lease a building from the lessor. The lease arrangement is for 8 years. Lease payments are $168,000 per year and are made at the beginning of the year. The lessee incurred initial direct costs of $65,000. Assume the following is the partial Lease Amortization Schedule (with only two rows and three columns shown) prepared by the lessee company:
|
Date |
Annual Payment |
Interest on Liability |
|
1/1/2022 |
168,000 |
40,000 |
|
1/1/2023 |
168,000 |
36,000 |
In the
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