6. Title to a right-of-use asset with a remaining economic life of 20 years does not...

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6. Title to a right-of-use asset with a remaining economic life of 20 years does not transfer to the lessee at the end of the 10 year lease term, but the lessor anticipates an unguaranteed residual value of $2,000. What is the period and residual value used by the lessee to depreciate the leased asset? Period 1 Remaining life at inception 2 Remaining life at inception 3 4 Lease term Lease term a. Choice 1 b. Choice 2 C. Choice 3 d. Choice 4 Residual value $0 $2,000 $2,000 $0 7. A company makes the following calculations to its defined benefit plan for funding purposes for an employee that is 40 years of age. The accumulated benefit method - $2, 111; projected unit credit method $3, 324 and the level contribution method: $4, 227. The company uses the accumulated benefit for funding the defined benefit plan. Record the journal entries for the pension expense and the pension payment. a. Dr. Pension expense $3, 324 Cr. Cash $3, 324 b. Dr. Pension expense $4, 227 Cr. Cash $2, 111 and Cr. Accrued pension liability $2, 116. Dr. Pension expense $2, 111 Cr. Cash $2, 111 C. d. Dr. Pension expense $3, 324 Cr. Cash $2, 111 and Cr. Accrued pension liability $1, 213. 6. Title to a right-of-use asset with a remaining economic life of 20 years does not transfer to the lessee at the end of the 10 year lease term, but the lessor anticipates an unguaranteed residual value of $2,000. What is the period and residual value used by the lessee to depreciate the leased asset? Period 1 Remaining life at inception 2 Remaining life at inception 3 4 Lease term Lease term a. Choice 1 b. Choice 2 C. Choice 3 d. Choice 4 Residual value $0 $2,000 $2,000 $0 7. A company makes the following calculations to its defined benefit plan for funding purposes for an employee that is 40 years of age. The accumulated benefit method - $2, 111; projected unit credit method $3, 324 and the level contribution method: $4, 227. The company uses the accumulated benefit for funding the defined benefit plan. Record the journal entries for the pension expense and the pension payment. a. Dr. Pension expense $3, 324 Cr. Cash $3, 324 b. Dr. Pension expense $4, 227 Cr. Cash $2, 111 and Cr. Accrued pension liability $2, 116. Dr. Pension expense $2, 111 Cr. Cash $2, 111 C. d. Dr. Pension expense $3, 324 Cr. Cash $2, 111 and Cr. Accrued pension liability $1, 213.

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