a. Prepare the journal entries for Salaur for 2019. b. Repeat the requirements in part a., assuming
Question:
b. Repeat the requirements in part a., assuming Salaur has the option to purchase the system at the end of the lease for €100.
Analysis
Briefly discuss the impact of capitalizing this lease for two common ratios: return on assets and debt to total assets.
Principles
What fundamental quality of useful information is being addressed when a company like Salaur capitalizes all leases with terms of one year or longer?
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Step by Step Answer:
Accounting a The lease liability is computed as follows Present value of lease payments 305725 X PVFAD 312 305725 X 269005 822416 Therefore Salaur makes the following journal entries at the commenceme...View the full answer
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Related Book For 
Intermediate Accounting IFRS
ISBN: 978-1119372936
3rd edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
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