Problem 5 At the beginning of the current year, Wayv Company leased building to NCT U under an operating lease for 10 years at P500,00 per year, payable the first day of each lease year. Wayv Company paid P150,000 to a real estate broker as a finder fee. The building is depreciated P120,000 per year. Wayv Company incurred insurance arnd property tax expense totaling PS0,000 for the current year. What armount should be reported as net rent income for the current year?

Problem 5 At the beginning of the current year, Wayv Company leased building to NCT U under an operating lease for 10 years at P500,00 per year, payable the first day of each lease year. Wayv Company paid P150,000 to a real estate broker as a finder fee. The building is depreciated P120,000 per year. Wayv Company incurred insurance arnd property tax expense totaling PS0,000 for the current year. What armount should be reported as net rent income for the current year?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 8PA: Referring to PA7 where Kenzie Company purchased a 3-D printer for $450,000, consider how the...

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Problem 3: ABC Co. leased a new machine from XXX Inc. on January 1, 20X1, under a lease with the following information: Lease term 10 years Annual rent payable at the end of each year P 80,000 Useful life of the machine 12 years Implicit interest rate 14% Lessee’s incremental borrowing rate 12% The annual rental payment includes P 6,000 to cover maintenance costs. The maintenance costs transfer services to ABC. The amount charged reflects the stand alone selling price of the maintenance services. Requirements: Provide the entries in 20X1 and 20X2. Determine the current and non-current portions of the lease liability on December 31, 20X1.
Problem 3 At the beginning of the current year, CBX Company sold a building with remaining life of 20 years and immediately leased it back for 5 years. Sales price at above fair value Fair value of building Carrying amount of building Annual rental payable at the end of each year Implicit interest rate Present value of an ordinary annuity of 1 at 12% for five periods 20,000,000 18,000,000 10,800,000 1,500,000 12% 12% 1. What amount should be reported as initial lease liability? 2. What amount should be recognized as cost of right of use asset? 3. What amount should be reported as gain on right transferred to the buyer-lessor? 4. What amount should be recognized as gross rental income of the buyer-lessor? 5. What amount should be recognized as depreciation of the building of the buyer-lessor?
At the beginning of current year, Arianne Company sold a Próblem 15-12 (IFRS) machine and immediately leased it back. 5,000,000 6,000,000 500,000 Sale price at fair value Carrying amount of machine Annual rental payable at the end of each year Lease term Remaining life of machine Implicit interest rate PV of an ordinary annuity of 1 at 6% for 5 perioda 5 years 20 years 6% 4.21 1. What is the cost of right of use asset? a. 2,105,000 b. 2,526,000 c. 2,895,000 d. 1,500,000 2. What is the loss on right transferred to the buyer-lessor? a. 579,000 b. 505,200 c. 500,000 d. 3. What is the lease liability at year-end? a. 2,177,560 b. 1,605,000 с. 1,731,300 d. 2,105,000 4. What is the net annual rental income of the buyer-lessor? a. 373,700 b. 200,000 с. 500,000 d. 250,000 17 I 10 Page +
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At the beginning of current year, Arianne Company sold a + 66.7% 17 / 19 Próblem 15-12 (IFRS) machine and immediately leased it back. 5,000,000 6,000,000 Sale price at fair value Carrying amount of machine Annual rental payable at the end of each year Lease term Remaining life of machine Implicit interest rate PV of an ordinary annuity of 1 at 6% for 5 perioda 500,000 5years 20 years 6% 421 1. What is the cost of right of use asset? a. 2,105,000 b. 2,526,000 c. 2,895,000 d. 1,500,000 2. What is the loss on right transferred to the buyer-lessor? a. 579,000 b. 505,200 c. 500,000 d. 3. What is the lease liability at year-end? a. 2,177,560 b. 1,605,000 c. 1,731,300 d. 2,105,000 4. What is the net annual rental income of the buyer-lessor!
25 Vanderbilt Company is a dealer in machinery. On January 1, 2010 machinery was leased to another enterprise with the following provisions: Annual rental payable at the end of each year, 3,000,000Lease term and useful life of machinery, 5 yearsCost of machinery, 8,000,000Residual value-unguaranteed, 1,000,000Implicit interest rate, 12%PV of an ordinary annuity of 1 for 5 periods at 12% 3.60PV of 1 for 5 periods at 12% 0.57 At the end of the lease term on December 31, 2010, the machinery will revert to Vanderbilt. The perpetual inventory system is used. Vanderbilt incurred initial direct cost of P300,000 in finalizing the lease agreement.What is the total financial revenue from the lease? a. 4,630,000 b. 4,200,000 c. 5,200,000 d. 3,630,000
At the beginning of current year, Panorama Company leased a building form a lessor with the following pertinent information Annual rental payable at the end of each year 1,000,000 Initial direct cost paid 400,000 Lease incentive received 100,000 Leasehold improvement 200,000 Purchase option that is reasonably certain to be exercised 500,000 Lease term 5 years Useful life of building 8 years Implicit interest rate 10% PV of an ordinary annuity of 1 for 5 periods at 10% 3.79 Present value of 1 for 5 periods at 10% 0.62 1. What is the cost of the right of use asset? a. 4,500,000 b. 4,400,000 c. 4,700,000 d. 4,600,000 2. What is the depreciation for current year? a. 880,000 b. 900,000 c. 550,000 d. 575,000 3. What is the interest expense for current year? a. 410,000 b. 379,000 c. 450,000 d. 429,000
A9
building with remaining useful life of 30 years and At the beginning of current year, Judy Company sold 66.7% 19 / 19 Problem 15-14 (IFRS) immediately leased it back for 5 years. Sale price at below fair value Fair value of building Carrying amount of building Annual rental payable at the end of each year Implicit interest rate Present value of an ordinary annuity of 1 at 12% for 5 periods 18,000,000 20,000,000 24,000,000 1,000,000 12% 3.60 1. What is the initial lease liability? a. 3,600,000 b. 4,000,000 C. 4,800,000 d. 2. What the cost of right of use asset? a. 3,000,000 b. 4,320,000 c. 5,760,000 d. 6,720,000 3. What is the loss on right transferred? a. 4,000,000 b. 2,880,000 c. 5,760,000 d. 6,720,000 4. What is the interest expense of the seller-lessee for the current year? a. 120,000 b. 576,000 c. 672,000 d. 432,000 5. What is the net annual rent income of the buyer-lessor? a. 400,000.
*see attached What is the net rent income for the current year? *a. 275,000b. 290,000c. 350,000d. 365,000
At the beginning of current year, an entity sold building with remaining useful life of 25 years and immediately leased it back for 5 years. Sale price at fair value 20,000,000 Carrying amount of building 24,000,000 Annual rental payable at the end of each year 1,000,000 Implicit interest rate 12% Present value of an ordinary annuity of 1 at 12% for 5 periods 3.60 What is the cost of right of use asset? What is annual depreciation of the right of use asset? What is the loss on right transferred? What amount of net rental income should be reported by the lessor?
1. What is the cost of the right of use asset? 2. What is the depreciation for current year?