1. On January 1, 2023, Mountaineer Company (lessee) entered into a four-year, noncancelable contract to lease...
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1. On January 1, 2023, Mountaineer Company (lessee) entered into a four-year, noncancelable contract to lease a computer from Cooper Computer Company (lessor). Annual rentals paid each January 1.: Guaranteed salvage value: $5,000; Higher salvage value expected by lessee. Asset returned to lessor at end of lease; Lessor's rate: 10% (known by lessee) Lessor's cost and FMV: $60,000; No uncertainties; predictable collection Useful life: 4 years Mountaineer Company is a calendar year reporting entity. Present Value Factors: 10% PV of $1,4 periods PV of annuity, 4 periods Required: .68301 3.16986 PV of annuity, 3 periods PV of ann. due, 4 periods 2.48685 3.48685 Prepare the amortization schedules for the lessee and the lessor Prepare the journal entries for both the lessee and lessor for the 4-year team of the lease. 4. In its Year 3 income statement, Noll Corp reported depreciation of $400,000. Noll reported depreciation of $550,000 on its Year 3 income tax return. The difference in depreciation is the only temporary difference, and it will reserve equally over the next three years. Assume that the enacted income tax rates are 35% for Year 3, 30% for Year 4, and 25% for Years 5 and 6. What amount should be included in the deferred income tax liability in Noll's December 31, Year 3 balance sheet? 1. On January 1, 2023, Mountaineer Company (lessee) entered into a four-year, noncancelable contract to lease a computer from Cooper Computer Company (lessor). Annual rentals paid each January 1.: Guaranteed salvage value: $5,000; Higher salvage value expected by lessee. Asset returned to lessor at end of lease; Lessor's rate: 10% (known by lessee) Lessor's cost and FMV: $60,000; No uncertainties; predictable collection Useful life: 4 years Mountaineer Company is a calendar year reporting entity. Present Value Factors: 10% PV of $1,4 periods PV of annuity, 4 periods Required: .68301 3.16986 PV of annuity, 3 periods PV of ann. due, 4 periods 2.48685 3.48685 Prepare the amortization schedules for the lessee and the lessor Prepare the journal entries for both the lessee and lessor for the 4-year team of the lease. 4. In its Year 3 income statement, Noll Corp reported depreciation of $400,000. Noll reported depreciation of $550,000 on its Year 3 income tax return. The difference in depreciation is the only temporary difference, and it will reserve equally over the next three years. Assume that the enacted income tax rates are 35% for Year 3, 30% for Year 4, and 25% for Years 5 and 6. What amount should be included in the deferred income tax liability in Noll's December 31, Year 3 balance sheet?
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PART I Amortization Schedule for Lessee Year Beginning Lease Liability Annual Lease Payment Interest Expense Reduction of Lease Liability Ending Lease Liability 1 59345 60000 655 18119 13119 5000 guar... View the full answer
Related Book For
Intermediate accounting
ISBN: 978-0077647094
7th edition
Authors: J. David Spiceland, James Sepe, Mark Nelson
Posted Date:
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