Presented below are three different lease transactions in which Ortiz Enterprises engaged in 2011.Assume that all lease
Question:
Instructions
(a) Identify the leases above as operating or capital leases. Explain.
(b) How should the lease transaction with Casey Co. be recorded on January 1, 2011?
(c) How should the lease transactions for Lester Inc. be recorded in2011?
Transcribed Image Text:
Lesso Schoen In Casey Co. Lester Inc. Type of property Bargain purchase option Lease term Estimated economic life Yearly rental Fair market value of leased Bulldozer None years 8 years $13,000 Truck None 6 years years $15,000 Furniture None years 5 years $4,000 $80,000 $72,000 $27.500 asset Present value of the lease rental payments $48,000 $62,000 $12,000
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 61% (18 reviews)
a Ortiz Enterprises should record the Casey Co lease as a capital ...View the full answer
Answered By
Rinki Devi
Professional, Experienced, and Expert tutor who will provide speedy and to-the-point solutions.
Hi there! Are you looking for a committed, reliable, and enthusiastic tutor? Well, teaching and learning are more of a second nature to me, having been raised by parents who are both teachers. I have done plenty of studying and lots of learning on many exciting and challenging topics. All these experiences have influenced my decision to take on the teaching role in various capacities. As a tutor, I am looking forward to getting to understand your needs and helping you achieve your academic goals. I'm highly flexible and contactable. I am available to work on short notice since I only prefer to work with very small and select groups of students.
I have been teaching students for 5 years now in different subjects and it's truly been one of the most rewarding experiences of my life. I have also done one-to-one tutoring with 100+ students and helped them achieve great subject knowledge.
5.00+
2+ Reviews
10+ Question Solved
Related Book For
Financial Accounting
ISBN: 978-0470507018
7th Edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Question Posted:
Students also viewed these Accounting questions
-
Presented below are three different lease transactions in which Amsrud Enterprises engaged in 2017. Assume that all lease transactions start on January 1, 2017. In no case does Amsrud receive title...
-
Presented below are three different lease transactions that occurred for Milo Inc. in 2011. Assume that all lease contracts start on January 1, 2011. In no case does Milo receive title to the...
-
Presented below are three different lease transactions that occurred for Klippert Inc., a public company. Assume that all lease contracts start on January 1, 2017. Klippert does not receive title to...
-
1. Because triangle A is congruent with triangle B, and triangle A is isosceles, it follows that triangle B is isosceles. 2. The plaque on the Leaning Tower of Pisa says that Galileo performed...
-
Complete the balance sheet and sales information using the following financial data: Total assets turnover: 1.5 Days sales outstanding: 36.5 daysa Inventory turnover ratio : 5 Fixed assets turnover:...
-
Use the curl integral in Stokes Theorem to find the circulation of the field F around the curve C in the indicated direction. C: The ellipse in which the plane 2x + 6y - 3z = 6 meets the cylinder x 2...
-
Determine the maximum axial force P that can be applied to the bar. The allowable stress is allow = 21 ksi. P 1.875 in. 0.125 in. 1.25 in. 0.75 in. r = 0.25 in. P
-
1. Rose could probably borrow the money to purchase the shares outright because the shares would serve as collateral and dividends would cover a good part of the loan payments. The interest rate is...
-
You are standing on a straight stretch of road and watching the motion of a bicycle; you choose your position as the origin. At one instant, the position of the bicycle is negative and its velocity...
-
Currently, Firm C has earnings per share (EPS) of $4 (per year) and has 1 million shares outstanding. Its price to earnings (P/E) ratio is 15. Firm D also has EPS of $4, has 3 million shares...
-
On January 1, 2011, the ledger of Shumway Software Company contains the following liability accounts. Accounts Payable .........$42,500 Sales Taxes Payable .........5,800 Unearned Service Revenue...
-
On January 1, 2011, the ledger of Zaur Company contains the following liability accounts. Accounts Payable ..........$52,000 Sales Taxes Payable ..........7,700 Unearned Service Revenue ......16,000...
-
Evaluate the following limits. (3x + 2 2 lim x2
-
Select a major supply chain issue from below that you have an interest in. Covid 19 impact on supply chains Green supply chains/ Sustainability in supply chains E-commerce impact on supply chains...
-
Maria's Bakery reported the following financial statements for last year. Income Statement Sales Costs of Goods Sold Depreciation Interest Tax Net Income $69,650 Dividends $51,240 $4,000 $5,820...
-
Question 4 The construction cost of a proposed Tollgate on an existing busy road network is R1.5 million. Table 4 provides estimated operation and maintenance costs as well as expected income for the...
-
During the Market Concept era, businesses developed a marketing strategy based on customer need. What are the three concepts?
-
Take a look at A1 Emergency Plan and revise it to determine errors. In your answer, identify the 9 errors and the page numbers where the errors are.
-
In 2018 the United States announced 25% tariffs on avocados imported from Mexico and that the higher price of avocados would be paid entirely by Mexico. Supporters of the tariff claimed that the...
-
A copper rod of length L =18.0 in is to be twisted by torques T (see figure) until the angle of rotation between the ends of the rod is 3.08. (a) If the allowable shear strain in the copper is 0.0006...
-
Let v = (2, 5) and w = (3, 2). Find a scalar such that v + w = 6.
-
Presented below are long-term liability items for Molini Company at December 31, 2010. Prepare the long-term liabilities section of the balance sheet for Molini Company. Bonds payable, due 2012 ......
-
(a) What is the present value of $10,000 due 8 periods from now, discounted at 10%? (b) What is the present value of $20,000 to be received at the end of each of 6 periods, discounted at 8%?
-
(a) What is the present value of $10,000 due 8 periods from now, discounted at 10%? (b) What is the present value of $20,000 to be received at the end of each of 6 periods, discounted at 8%?
-
Some users on your network use Acme Bank for their personal banking. Those users have all recently been the victim of an attack, in which they visited a fake Acme Bank website and their logins were...
-
Solve ADEF. Round to the nearest whole number when necessary. Give angle measures in degrees. 4 E |DE= 4 mZDz DF mZE= 90 EF= 6 m/F 9 LL F
-
Find the total energy available from a rechargeable 1.25-V flashlight battery with a 1.2-Ah rating. If all the energy in a 9-V transistor radio battery rated at 0.392 Ah is used to lift a 150-lb man,...
Study smarter with the SolutionInn App