Danio Leasing Sdn Bhd entered into a finance lease arrangements with Tetra Bhd for a vintage...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Danio Leasing Sdn Bhd entered into a finance lease arrangements with Tetra Bhd for a vintage car. Danio leasing Sdn Bhd imported the car at a price of RM1,000,000. The lease term is for four years and the lease agreement requires a yearly lease payment of RM250,000. At the end of Year 4, Danio Leasing Sdn Bhd will repossess the vintage car and then offer the car for sale to Tetra or by auction. Tetra Bhd has guaranteed a residual value of RM400,000 at the end of Year 4. However, Danio Leasing Sdn Bhd estimates that the residual value is more likely to be about RM500,000. Required: a. Determine the amount of lease debtor that Danio Leasing shall record at the commencement of the lease b. Determine the carrying amount of the lease debtor at the end of each year and the related interest income for each year. Danio Leasing Sdn Bhd entered into a finance lease arrangements with Tetra Bhd for a vintage car. Danio leasing Sdn Bhd imported the car at a price of RM1,000,000. The lease term is for four years and the lease agreement requires a yearly lease payment of RM250,000. At the end of Year 4, Danio Leasing Sdn Bhd will repossess the vintage car and then offer the car for sale to Tetra or by auction. Tetra Bhd has guaranteed a residual value of RM400,000 at the end of Year 4. However, Danio Leasing Sdn Bhd estimates that the residual value is more likely to be about RM500,000. Required: a. Determine the amount of lease debtor that Danio Leasing shall record at the commencement of the lease b. Determine the carrying amount of the lease debtor at the end of each year and the related interest income for each year.
Expert Answer:
Answer rating: 100% (QA)
Answer a Danio Leasing Sdn Bhd should record the lease debtor at the net investment value Net invest... View the full answer
Related Book For
Fundamental Accounting Principles
ISBN: 978-0078110870
20th Edition
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta
Posted Date:
Students also viewed these accounting questions
-
Prepare the journal entry to record Channel One Companys issuance of 100,000 shares of $0.50 par value common stock assuming the shares sell for: a. $0.50 cash per share. b. $2 cash per share.
-
Prepare the journal entry to record Selectist Companys issuance of 104,000 shares of no-par value common stock assuming the shares: a. Sell for $15 cash per share. b. Are exchanged for land valued at...
-
Nueve Ltd. had the following pre-tax earnings and losses: Year Pre-tax Earnings (Loss) Tax rate 20x3 $330,000 34% 20x4 $165,000 34% 20x5 $540,000 34% 20x6 $660,000 36% 20x7 ($3,330,000) 36% 20x8...
-
Consider the nutrition problem in Example 1 of Section 3.3. Solve the problem by the simplex method, and then determine the optimal quantities of soybeans and rice in the diet, and the new cost, if...
-
What type of audit report would be appropriate in each of the following scenarios? Explain. (a) There is uncertainty relating to a pending exceptional litigation matter that is adequately disclosed...
-
What is the difference between a multi-step income statement and a single-step income statement?
-
What is meant by corporate governance and why is it important?
-
For a recent year, McDonalds company- owned restaurants had the following sales and expenses (in millions): Sales ...................$16,233 Food and packaging .............$ 5,300 Payroll...
-
explain diagram of ER model and relational model and attach their diagrams too Each cinema is identified by its name and has its residency at an address which consists of a street and city only....
-
1. What is the cost of debt for Sunrise Bakery? 2. What is their cost of equity? 3. What is the WACC? 4. Which cost of capital should be used to evaluate the feasibility of the oven purchase? 5....
-
Firm A, a retailer who sells raisins to customers, needs to pick up the optimal retail price of raisins in order to maximize the revenue in the next season. The optimal raisin price should be made...
-
determine the break-even analysis to cover your fixed costs. The information you have is the following... Fixed costs: $40,000 Variable cost per unit: $4.50 Total units sold: 20,000
-
The gas-phase dimerization 2A B follows an elementary rate law and takes place isothermally in a PBR charged with 1 kg of catalyst. The feed consists of pure A and enters the reactor at a pressure...
-
The Harbor Square Athletic Club is running a special, and charges a $15 initiation fee plus $93 per month to be a member. The local YMCA charges $125 to join, and charges $75 per month. a. Find the...
-
Hudaverdi Ltd pay current dividends of $0.96 per share with these dividends expected to grow at a rate of 4.6% per year in perpetuity. Hudaverdi Ltd shares are currently trading at $7.47 per share....
-
Consider the following information for Evenflow Power Co., Debt: 3,000 6.5 percent coupon bonds outstanding, $1,000 par value, 18 years to maturity, selling for 103 percent of par; the bonds make...
-
6) An apple drops from a tree and falls to the ground 3.15 m below. (a) How much time does it take for the apple to reach the ground? (Solve (a) for two cases (i) Take the origin at ground and upward...
-
Phosgene, COCl2, is a toxic gas used in the manufacture of urethane plastics. The gas dissociates at high temperature. At 400oC, the equilibrium constant Kc is 8.05 104. Find the percentage of...
-
Walt Disney reports the following information for its two Parks and Resorts divisions Assume Walt Disney uses a balanced scorecard and sets a target of 90% occupancy in its resorts. Using Exhibit...
-
On October 10, the stockholders equity of Noble Systems appears as follows. Common stock $10 par value, 36,000 shares authorized, issued, and outstanding . . . . . . . . . . . . . . . . . . . . . . ....
-
Setting materials, labor, and overhead standards is challenging. If standards are set too low, companies might purchase inferior products and employees might not work to their full potential. If...
-
Baggai Enterprises has an ROA of 10 percent, retains 30 percent of earnings, and has an equity multiplier of 1.25. Mondale Enterprises also has an ROA of 10 percent, but it retains two-thirds of...
-
International Business Machines (NYSE: IBM), which currently pays a dividend of \($3.40\) per share, has been the subject of two other examples in this reading. In one example, an analyst estimated...
-
An analyst is preparing a forecast of dividends for Hoshino Distributors for the next five years. He uses a spreadsheet model with the following assumptions: Sales are $100 million in Year 1. They...
Study smarter with the SolutionInn App