The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

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Answer 1

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Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 18, Problem 1FSAC

a.

To determine

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

b.

To determine

To prepare: The journal entries to reflect the scheduled payment during fiscal 2015 for operating and capital in place of fiscal 2014.

c.

To determine

The average interest rate on capital lease.

Given information:

Interest expense is $277.

Present value of future minimum lease payments is $3,094.

d.

To determine

To Prepare: The journal entry to record the capitalization of leases.

d.

To determine

The amount of interest expense and depreciation.

f.

To determine

The changes in assets, liabilities, and equity if all the operating leases has capitalized and also find the debt to equity ratio and total liabilities to total assets ratio and explain if operating leases capitalize the debt to equity ratio and total liability to total asset ratio.

g.

To determine

The change in the fiscal net income 2014.

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Bodega Chocolate, Inc. is a new company that produces a single product. The company has no beginning inventory. During the year, the company produced 10,000 units out of which 9,000 were sold. Below are Bodega's costs: Variable costs per unit: Production $4.00 Selling and administrative $2.50 Total fixed costs for the year: Production $20,700.00 Selling and administrative $85,000 a) What is the unit product using absorption costing? b) What is the unit product cost using variable costing?

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Answer 2

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 18, Problem 1FSAC

a.

To determine

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

b.

To determine

To prepare: The journal entries to reflect the scheduled payment during fiscal 2015 for operating and capital in place of fiscal 2014.

c.

To determine

The average interest rate on capital lease.

Given information:

Interest expense is $277.

Present value of future minimum lease payments is $3,094.

d.

To determine

To Prepare: The journal entry to record the capitalization of leases.

d.

To determine

The amount of interest expense and depreciation.

f.

To determine

The changes in assets, liabilities, and equity if all the operating leases has capitalized and also find the debt to equity ratio and total liabilities to total assets ratio and explain if operating leases capitalize the debt to equity ratio and total liability to total asset ratio.

g.

To determine

The change in the fiscal net income 2014.

Expert Solution & Answer

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Answer 3

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 18, Problem 1FSAC

a.

To determine

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

b.

To determine

To prepare: The journal entries to reflect the scheduled payment during fiscal 2015 for operating and capital in place of fiscal 2014.

c.

To determine

The average interest rate on capital lease.

Given information:

Interest expense is $277.

Present value of future minimum lease payments is $3,094.

d.

To determine

To Prepare: The journal entry to record the capitalization of leases.

d.

To determine

The amount of interest expense and depreciation.

f.

To determine

The changes in assets, liabilities, and equity if all the operating leases has capitalized and also find the debt to equity ratio and total liabilities to total assets ratio and explain if operating leases capitalize the debt to equity ratio and total liability to total asset ratio.

g.

To determine

The change in the fiscal net income 2014.

Expert Solution & Answer

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Check out a sample textbook solution

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Answer 4

Question

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Chapter 18, Problem 1FSAC

a.

To determine

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

b.

To determine

To prepare: The journal entries to reflect the scheduled payment during fiscal 2015 for operating and capital in place of fiscal 2014.

c.

To determine

The average interest rate on capital lease.

Given information:

Interest expense is $277.

Present value of future minimum lease payments is $3,094.

d.

To determine

To Prepare: The journal entry to record the capitalization of leases.

d.

To determine

The amount of interest expense and depreciation.

f.

To determine

The changes in assets, liabilities, and equity if all the operating leases has capitalized and also find the debt to equity ratio and total liabilities to total assets ratio and explain if operating leases capitalize the debt to equity ratio and total liability to total asset ratio.

g.

To determine

The change in the fiscal net income 2014.

Expert Solution & Answer

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Answer 5

Chapter 18, Problem 1FSAC

a.

To determine

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

b.

To determine

To prepare: The journal entries to reflect the scheduled payment during fiscal 2015 for operating and capital in place of fiscal 2014.

c.

To determine

The average interest rate on capital lease.

Given information:

Interest expense is $277.

Present value of future minimum lease payments is $3,094.

d.

To determine

To Prepare: The journal entry to record the capitalization of leases.

d.

To determine

The amount of interest expense and depreciation.

f.

To determine

The changes in assets, liabilities, and equity if all the operating leases has capitalized and also find the debt to equity ratio and total liabilities to total assets ratio and explain if operating leases capitalize the debt to equity ratio and total liability to total asset ratio.

g.

To determine

The change in the fiscal net income 2014.

Answer 6

Chapter 18, Problem 1FSAC

a.

To determine

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

Answer 7

Chapter 18, Problem 1FSAC

a.

To determine

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

Answer 8

b.

To determine

To prepare: The journal entries to reflect the scheduled payment during fiscal 2015 for operating and capital in place of fiscal 2014.

Answer 9

b.

To determine

To prepare: The journal entries to reflect the scheduled payment during fiscal 2015 for operating and capital in place of fiscal 2014.

Answer 10

c.

To determine

The average interest rate on capital lease.

Given information:

Interest expense is $277.

Present value of future minimum lease payments is $3,094.

Answer 11

c.

To determine

The average interest rate on capital lease.

Given information:

Interest expense is $277.

Present value of future minimum lease payments is $3,094.

Answer 12

d.

To determine

To Prepare: The journal entry to record the capitalization of leases.

Answer 13

d.

To determine

To Prepare: The journal entry to record the capitalization of leases.

Answer 14

d.

To determine

The amount of interest expense and depreciation.

Answer 15

d.

To determine

The amount of interest expense and depreciation.

Answer 16

f.

To determine

The changes in assets, liabilities, and equity if all the operating leases has capitalized and also find the debt to equity ratio and total liabilities to total assets ratio and explain if operating leases capitalize the debt to equity ratio and total liability to total asset ratio.

Answer 17

f.

To determine

The changes in assets, liabilities, and equity if all the operating leases has capitalized and also find the debt to equity ratio and total liabilities to total assets ratio and explain if operating leases capitalize the debt to equity ratio and total liability to total asset ratio.

Answer 18

g.

To determine

The change in the fiscal net income 2014.

Answer 19

g.

To determine

The change in the fiscal net income 2014.

Answer 20

Expert Solution & Answer

Answer 21

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Answer 22

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Answer 23

Ch. 18 - Does the lessee become the owner of the equipment...Ch. 18 - Prob. 18.2Q Ch. 18 - Prob. 18.3Q Ch. 18 - Prob. 18.4Q Ch. 18 - Prob. 18.5Q Ch. 18 - Prob. 18.6Q Ch. 18 - Prob. 18.7Q Ch. 18 - Prob. 18.8Q Ch. 18 - Prob. 18.9Q Ch. 18 - Prob. 18.10Q

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

The effect on the financial statement of operating lease and capital lease on the balance sheet and income statement and explain the financial statement effect of capitalizing operating expenses.

To prepare: The journal entries to reflect the scheduled payment during fiscal 2015 for operating and capital in place of fiscal 2014.

The average interest rate on capital lease. Given information: Interest expense is $277. Present value of future minimum lease payments is $3,094.

To Prepare: The journal entry to record the capitalization of leases.

The amount of interest expense and depreciation.

The changes in assets, liabilities, and equity if all the operating leases has capitalized and also find the debt to equity ratio and total liabilities to total assets ratio and explain if operating leases capitalize the debt to equity ratio and total liability to total asset ratio.

The change in the fiscal net income 2014.

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Chapter 18 Solutions

The average interest rate on capital lease.

Given information:

Interest expense is $277.

Present value of future minimum lease payments is $3,094.