Oriole Company, a machinery dealer, leased a machine to Pharoah Corporation on January 1, 2025. The...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Oriole Company, a machinery dealer, leased a machine to Pharoah Corporation on January 1, 2025. The lease is for an 8-year period and requires equal annual payments of $31,144 at the beginning of each year. The first payment is received on January 1, 2025. Oriole had purchased the machine during 2024 for $123,000. Collectibility of lease payments by Oriole is probable. Oriole set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Oriole at the termination of the lease. Click here to view factor tables. (a) Your answer is incorrect. Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to O decimal places e.g. 5,275.) Amount of the lease receivable $ 138402 TABLE 6.2 Present Value of 1 (Present Value of a Single Sum) PVFn = 1 (1 + i)" = (1 + i)" (n) Periods 2% 2% 3% 4% 5% 6% 12345 .98039 .97561 .97087 .96154 .95238 .94340 .96117 95181 .94260 .92456 .90703 .89000 .94232 .92860 .91514 .88900 .86384 .83962 .92385 .90595 .88849 .85480 .82270 .79209 5 .90573 .88385 .86261 .82193 .78353 .74726 10 68419 .88797 .86230 .83748 .79031 .74622 .70496 7 .87056 .84127 .81309 .75992 .71068 .66506 .85349 .82075 .78941 .73069 .67684 .62741 .83676 .80073 .76642 .70259 .64461 .59190 .82035 .78120 .74409 .67556 .61391 55839 12345 67602 11 .80426 .76214 .72242 .64958 .58468 .52679 .78849 .74356 .70138 .62460 .55684 .49697 .77303 .72542 .68095 .60057 .53032 .46884 .75788 .70773 .66112 .57748 .50507 .44230 .74301 .69047 .64186 .55526 .48102 .41727 16 .72845 .67362 .62317 .53391 .45811 .39365 17 .71416 .65720 .60502 .51337 .43630 .37136 18 .70016 .64117 .58739 .49363 .41552 .35034 19 .68643 .62553 .57029 .47464 .39573 .33051 .67297 .61027 .55368 45639 .37689 31180 2222 22222 21 .65978 .59539 .53755 .43883 .35894 29416 .64684 .58086 .52189 .42196 .34185 27751 23 .63416 .56670 .50669 .40573 .32557 26180 24 .62172 .55288 .49193 .39012 .31007 24698 25 .60953 .53939 .47761 .37512 .29530 23300 26 .59758 .52623 .46369 .36069 .28124 21981 27 .58586 .51340 .45019 .34682 .26785 20737 28 .57437 .50088 .43708 .33348 .25509 .19563 29 .56311 .48866 .42435 .32065 .24295 .18456 30 .55207 .47674 .41199 .30832 .23138 17411 31 .54125 .46511 .39999 .29646 .22036 .16425 34 35 38 39 333333333 32 .53063 .45377 .38834 .28506 .20987 .15496 .52023 .44270 .37703 .27409 .19987 .14619 .51003 .43191 .36604 .26355 .19035 .13791 .50003 .42137 .35538 .25342 .18129 .13011 36 .49022 .41109 .34503 .24367 .17266 .12274 37 .48061 .40107 .33498 .23430 .16444 .11579 .47119 .39128 .32523 .22529 .15661 .10924 .46195 .38174 .31575 .21662 .14915 .10306 40 .45289 .37243 .30656 .20829 .14205 .09722 TABLE 6.2 Present Value of 1 (n) 8% 9% 10% 11% 12% 15% Periods .92593 .91743 .90909 .90090 .89286 .86957 .85734 .84168 .82645 .81162 .79719 .75614 .79383 .77218 .75132 .73119 .71178 .65752 123 Oriole Company, a machinery dealer, leased a machine to Pharoah Corporation on January 1, 2025. The lease is for an 8-year period and requires equal annual payments of $31,144 at the beginning of each year. The first payment is received on January 1, 2025. Oriole had purchased the machine during 2024 for $123,000. Collectibility of lease payments by Oriole is probable. Oriole set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Oriole at the termination of the lease. Click here to view factor tables. (a) Your answer is incorrect. Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to O decimal places e.g. 5,275.) Amount of the lease receivable $ 138402 TABLE 6.2 Present Value of 1 (Present Value of a Single Sum) PVFn = 1 (1 + i)" = (1 + i)" (n) Periods 2% 2% 3% 4% 5% 6% 12345 .98039 .97561 .97087 .96154 .95238 .94340 .96117 95181 .94260 .92456 .90703 .89000 .94232 .92860 .91514 .88900 .86384 .83962 .92385 .90595 .88849 .85480 .82270 .79209 5 .90573 .88385 .86261 .82193 .78353 .74726 10 68419 .88797 .86230 .83748 .79031 .74622 .70496 7 .87056 .84127 .81309 .75992 .71068 .66506 .85349 .82075 .78941 .73069 .67684 .62741 .83676 .80073 .76642 .70259 .64461 .59190 .82035 .78120 .74409 .67556 .61391 55839 12345 67602 11 .80426 .76214 .72242 .64958 .58468 .52679 .78849 .74356 .70138 .62460 .55684 .49697 .77303 .72542 .68095 .60057 .53032 .46884 .75788 .70773 .66112 .57748 .50507 .44230 .74301 .69047 .64186 .55526 .48102 .41727 16 .72845 .67362 .62317 .53391 .45811 .39365 17 .71416 .65720 .60502 .51337 .43630 .37136 18 .70016 .64117 .58739 .49363 .41552 .35034 19 .68643 .62553 .57029 .47464 .39573 .33051 .67297 .61027 .55368 45639 .37689 31180 2222 22222 21 .65978 .59539 .53755 .43883 .35894 29416 .64684 .58086 .52189 .42196 .34185 27751 23 .63416 .56670 .50669 .40573 .32557 26180 24 .62172 .55288 .49193 .39012 .31007 24698 25 .60953 .53939 .47761 .37512 .29530 23300 26 .59758 .52623 .46369 .36069 .28124 21981 27 .58586 .51340 .45019 .34682 .26785 20737 28 .57437 .50088 .43708 .33348 .25509 .19563 29 .56311 .48866 .42435 .32065 .24295 .18456 30 .55207 .47674 .41199 .30832 .23138 17411 31 .54125 .46511 .39999 .29646 .22036 .16425 34 35 38 39 333333333 32 .53063 .45377 .38834 .28506 .20987 .15496 .52023 .44270 .37703 .27409 .19987 .14619 .51003 .43191 .36604 .26355 .19035 .13791 .50003 .42137 .35538 .25342 .18129 .13011 36 .49022 .41109 .34503 .24367 .17266 .12274 37 .48061 .40107 .33498 .23430 .16444 .11579 .47119 .39128 .32523 .22529 .15661 .10924 .46195 .38174 .31575 .21662 .14915 .10306 40 .45289 .37243 .30656 .20829 .14205 .09722 TABLE 6.2 Present Value of 1 (n) 8% 9% 10% 11% 12% 15% Periods .92593 .91743 .90909 .90090 .89286 .86957 .85734 .84168 .82645 .81162 .79719 .75614 .79383 .77218 .75132 .73119 .71178 .65752 123
Expert Answer:
Related Book For
Intermediate Accounting IFRS
ISBN: 9781119607519
4th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
Students also viewed these accounting questions
-
Buoyancy: The wood log shown in Figure 2 is 0.15 m by 0.35 m in cross-section. Determine: a. Unit weight of the wood log. b. Tension in the rope. -Rope 8 m 2 m Figure 2: Tethered log 0.15 m Water
-
For each of the following, determine (i) the market in question; (ii) whether a shi in demand or supply occurred, the direction of the shi, and what induced the shi; and (iii) the effect of the shi...
-
The trial balance of Amusement Specialties, Inc., follows: Vicki Gutierrez, your best friend, is considering investing in Amusement Specialties, Inc. Vicki seeks your advice in interpreting the...
-
Lester Hollar is vice president for human resources for a large manufacturing company. In recent years, he has noticed an increase in absenteeism that he thinks is related to the general health of...
-
Tennessee law imposes durational-residency requirements on persons and companies wishing to operate retail liquor stores, requiring applicants for an initial license to have resided in the state for...
-
The following balances were taken from the books of Parnevik Corp. on December 31, 2012. Assume the total effective tax rate on all items is 34%.InstructionsPrepare a multiple-step income statement;...
-
1. (10) A $10 000 bond was issued on January 1st 2015 with a coupon rate of 9.7% and a redemption date of January 1st 2025. What is the purchase price of the bond on January 1st, 2022 when the yield...
-
On December 31, 2018, Penneez, Inc., approaches Dollarz Bank seeking new terms for its debt. On that date, Penneez owes Dollarz $220,000 on a 10-year, 10% note issued at par. In addition, it also...
-
Greta Cook died in 2019. Her gross estate was $11,490,000, administration expenses were $60,000, and adjusted taxable gifts were $20,000. Compute the estate tax liability.
-
Karen engaged Joe, a CPA, to prepare her tax return. Karen received a refund check of $300 from the IRS. She endorsed the check and mailed it to Joe as payment for the preparation of her return. Joe...
-
Susie and Marilyn transfer property in exchange for all of Falco stock. Susie transfers land and building worth $200,000 in exchange for 150 shares and Marilyn transfers equipment worth $200,000 for...
-
Code Sec. 303(b)(2) (A)(ii) makes reference to two other Code sections. What are they?
-
Your client, Steve, is an engineer whose income has doubled over the past four years. He feels that by incorporating he could reduce his tax significantly. However, he can demonstrate no business...
-
Write a research paper on: Agoraphobia. Include a history of the disorder and discuss issues related to the diagnostic criteria. Treatment of the disorder can be covered but it is not the focus of...
-
Solve each problem. Find the coordinates of the points of intersection of the line y = 2 and the circle with center at (4, 5) and radius 4.
-
Sondgeroth Ltd. reports the following pretax income (loss) for both financial reporting purposes and tax purposes. The tax rates listed were all enacted by the beginning of 2020. Instructions a....
-
Teresa Ramirez and Lenny Traylor are examining the following statement of cash flows for Panaka Clothing Stores first year of operations. Panaka Clothing Store Statement of Cash Flows For the Year...
-
Economy Appliance Co. manufactures low-price, no-frills appliances that are in great demand for rental units. Pricing and cost information on Economys main products are as follows. Item...
-
If you want to triple your money at an interest rate of 6 percent per year compounded annually, how many years would you have to leave the money in the account? a. 12 years b. 19 years c. 32 years d....
-
Let F be the accumulated sum, P the principal invested, i the annual compound interest rate, and n the number of years. Which of the following correctly relates these quantities? a. F = P(1+in) b. F...
-
If you invest $5,000 three years from now, how much will be in the account 15 years from now if i = 10 percent compounded annually? a. $8,053 b. $15,692 c. $20,886 d. $27,800
Study smarter with the SolutionInn App