The classification of a lease for lessor as per IFRS. Given information: Lease term is 9 years. Lease doesn’t contain a transfer of ownership. Lease doesn’t contain a purchase option. Economic life of an asset is 9 years. Fair value of the asset is $1,349,328. Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year. Implicit interest rate is 8% Annual lease payments are $200,000 due on Jan/1 each year

Question

Want to see the full answer?

Answer 1

Question

Chapter 18, Problem 18.16E

a.

To determine

The classification of a lease for lessor as per IFRS.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

b.

To determine

To prepare: The right of use asset, lease liability, and amortization tables for the lease term.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

c.

To determine

To prepare: The journal entries for the lessor for year one.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Cost of the asset is $1,300,000.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Please provide solution this financial accounting question not use chatgpt

Berkley Shoe Company's work-in-process inventory on July 1 has a balance of $25,600, representing Job No. 314. During July, $54,800 of direct materials were requisitioned for Job No. 314, and $37,200 of direct labor cost was incurred on Job No. 314. Manufacturing overhead is allocated at 130% of direct labor cost. Actual manufacturing overhead costs incurred in July amounted to $46,200. No new jobs were started during July. Job No. 314 is completed on July 30. Is manufacturing overhead overallocated or under-allocated for the month of July and by how much?help

The profit margin would be

Answer 2

Question

Chapter 18, Problem 18.16E

a.

To determine

The classification of a lease for lessor as per IFRS.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

b.

To determine

To prepare: The right of use asset, lease liability, and amortization tables for the lease term.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

c.

To determine

To prepare: The journal entries for the lessor for year one.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Cost of the asset is $1,300,000.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 18, Problem 18.16E

a.

To determine

The classification of a lease for lessor as per IFRS.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

b.

To determine

To prepare: The right of use asset, lease liability, and amortization tables for the lease term.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

c.

To determine

To prepare: The journal entries for the lessor for year one.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Cost of the asset is $1,300,000.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 18, Problem 18.16E

a.

To determine

The classification of a lease for lessor as per IFRS.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

b.

To determine

To prepare: The right of use asset, lease liability, and amortization tables for the lease term.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

c.

To determine

To prepare: The journal entries for the lessor for year one.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Cost of the asset is $1,300,000.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 18, Problem 18.16E

a.

To determine

The classification of a lease for lessor as per IFRS.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

b.

To determine

To prepare: The right of use asset, lease liability, and amortization tables for the lease term.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

c.

To determine

To prepare: The journal entries for the lessor for year one.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Cost of the asset is $1,300,000.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Answer 6

Chapter 18, Problem 18.16E

a.

To determine

The classification of a lease for lessor as per IFRS.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Answer 7

Chapter 18, Problem 18.16E

a.

To determine

The classification of a lease for lessor as per IFRS.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Answer 8

b.

To determine

To prepare: The right of use asset, lease liability, and amortization tables for the lease term.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Answer 9

b.

To determine

To prepare: The right of use asset, lease liability, and amortization tables for the lease term.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Answer 10

c.

To determine

To prepare: The journal entries for the lessor for year one.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Cost of the asset is $1,300,000.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Answer 11

c.

To determine

To prepare: The journal entries for the lessor for year one.

Given information:

Lease term is 9 years.

Lease doesn’t contain a transfer of ownership.

Lease doesn’t contain a purchase option.

Economic life of an asset is 9 years.

Fair value of the asset is $1,349,328.

Cost of the asset is $1,300,000.

Maintenance charges (general and administrative expenses) $5,600 payable at the end of each year.

Implicit interest rate is 8%

Annual lease payments are $200,000 due on Jan/1 each year

Answer 12

Expert Solution & Answer

Answer 13

Expert Solution & Answer

Answer 14

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 15

Ch. 18 - Does the lessee become the owner of the equipment...Ch. 18 - Prob. 18.2Q Ch. 18 - Prob. 18.3Q Ch. 18 - What are typical terms and provisions in a lease...Ch. 18 - How does a lease offer business and financial...Ch. 18 - Prob. 18.6Q Ch. 18 - How is the right-of-use asset measured?Ch. 18 - What components are included in a lease contract?Ch. 18 - How does a lessee separate lease and nonlease...Ch. 18 - How does a lessor separate lease and nonlease...

Want to see the full answer?

Chapter 18 Solutions