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:...
-
Evaluate the following definite integrals. x sin x dx
-
Are there organizations that provide a list of potential arbitrators and mediators in your area? What types of disputes are subject to arbitration?
-
a. Create a data flow diagram of the current system. b. Create a system flowchart of the existing system. c. Identify the internal control weaknesses in the system. Use the six categories of physical...
-
Tic tac toe has subgame perfect equilibria in which the first player puts her first X in a corner. The second player's move is the same in all these equilibria. What is it? Subgame perfect equilibria...
-
A 4-year-old Holstein dairy cow in peak lactation is losing body weight at a faster rate than desired. The farmer has asked for your help in rebalancing the cow's ration. The cow needs a ration that...
-
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...
-
Is there any truth in the saying that the price of a good is a reflection of its quality?
-
A firms stock has expected return of 10.25% a beta of 1.25 and its in equilibrium. If it ye risk free rate is 2.09% what is the market risk premium
-
Sale of investments $ 6,000 Cash collections from customers 16,000 Cash purchase of used equipment 5,000 Depreciation expense 2,000 Compute cash flows from investing activities using the above...
-
Zhao Company has fixed costs of $455,600. Its single product sells for $191 per unit, and variable costs are $124 per unit. If the company expects sales of 10,000 units, compute its margin of safety...
-
You have just purchased the options listed below. Based on the information given, indicate whether the option is in the money, out of the money, or at the money, whether you would exercise the option...
-
What is the present value of a security that will pay $10,000 in 5 years if securities of equal risk pay 3.5% annually? What is the present value of a security that will pay $3,000 in 10 years if...
-
For many years, AutoZone, a Nevada corporation, was an official sponsor of the Bud Light Professional Bull Rider Series organized and conducted by Professional Bull Riders (PBR), a Colorado...
-
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%?
-
You have just retired with savings of $ 1 . 5 million. If you expect to live for 3 0 years and to earn 8 % a year on your savings, how much can you afford to spend each month? Assume that you spend...
-
Mrs . Page had just completed a series of dental appointments. Typically Mrs . Page is a positive and very complimentary of the dental healthcare team. However, today you notice that she is very...
-
what is my principal reduction balance if my mortgage balance is $ 1 1 7 , 0 0 0 at a mortgage rate of 6 . 2 5 % and I make my payment of 9 3 6
Study smarter with the SolutionInn App