Calculate the amount to be paid (in $) by the insurance company for the claim. (Round your answer to the nearest cent.)Amount of LossInsurance CompanyWill PayReplacementValue ofBuilding$340,000Submit AnsworFace Value Coinsurance Amountof PolicyClause (%)of Loss$300,00090$115,000$X

Answer : Replacement value of the building = $340,000 Coinsurance clause = 90% Insurance required =…

Answered: Replacement Value of Building $340,000…

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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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?
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Replacement Value of Building $340,000 Face Value of Policy $300,000 Coinsurance Amount Clause (%) of Loss 90 $115,000 Amount of Loss Insurance Company Will Pay