TB Problem 15-200 (Static) Amelia Company leased a warehouse from... Amelia Company leased a warehouse from Island Industries on July 1, 2024, in a finance lease. The present value of the lease payments discounted at 10% was $162,217. Ten annual lease payments of $24,000 are due each July 1, beginning July 1, 2024. Island had constructed the building recently for $132,000 and its retail fair value was $162,217. Required: Assuming that control of the warehouse building is transferred to Amelia Company at the beginning of the lease. Prepare the two journal entries to record the lease by Island on July 1, 2024. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No 1 2 Date July 01, 2024 July 01, 2024 Lease receivable Cost of goods sold Building Cash Lease receivable Answer is not complete. General Journal 333 ✓ Debit 162,217 ✔ 24,000✔ Credit 30,217 x 132,000 ✓ 24,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
TB Problem 15-200 (Static) Amelia Company leased a warehouse from...
Amelia Company leased a warehouse from Island Industries on July 1, 2024, in a finance lease. The present value of the lease
payments discounted at 10% was $162,217. Ten annual lease payments of $24,000 are due each July 1, beginning July 1, 2024. Island
had constructed the building recently for $132,000 and its retail fair value was $162,217.
Required:
Assuming that control of the warehouse building is transferred to Amelia Company at the beginning of the lease. Prepare the two
journal entries to record the lease by Island on July 1, 2024.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
No
1
2
Date
July 01, 2024
July 01, 2024
Lease receivable
Cost of goods sold
Building
Cash
Lease receivable
Answer is not complete.
General Journal
333
Debit
162,217✔
24,000✔
Credit
30,217 X
132,000 ✓
24,000
Transcribed Image Text:TB Problem 15-200 (Static) Amelia Company leased a warehouse from... Amelia Company leased a warehouse from Island Industries on July 1, 2024, in a finance lease. The present value of the lease payments discounted at 10% was $162,217. Ten annual lease payments of $24,000 are due each July 1, beginning July 1, 2024. Island had constructed the building recently for $132,000 and its retail fair value was $162,217. Required: Assuming that control of the warehouse building is transferred to Amelia Company at the beginning of the lease. Prepare the two journal entries to record the lease by Island on July 1, 2024. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. No 1 2 Date July 01, 2024 July 01, 2024 Lease receivable Cost of goods sold Building Cash Lease receivable Answer is not complete. General Journal 333 Debit 162,217✔ 24,000✔ Credit 30,217 X 132,000 ✓ 24,000
Expert Solution
steps

Step by step

Solved in 3 steps

Blurred answer
Knowledge Booster
Lease accounting
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education