Question: A Ltd has made a security deposit whose details are described below. Make necessary journal entries for accounting of the deposit in the first

A Ltd has made a security deposit whose details are described below. Make necessary journal entries for accounting of the deposit in the first year and last year. Assume market interest rate for a deposit for similar period to be 12% per annum. Particulars Details 1-Apr-20X1 31-Mar-20X6 Date of Security Deposit (Starting Date) Date of Security Deposit (Finishing Date) Description Total Lease Period Lease 5 years 12.00% 10,00,000 Discount rate Security deposit (A) Present value factor at the 5th year 0.567427

Step by Step Solution

★★★★★

3.41 Rating (157 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Solution Journal Entries Date Account Dr Cr Security deposit 567427 Prepaid lease expenses ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

Find the approximate volume of the solid in the first octant that is bounded by the planes y = x, z = 0, and z = x and the cylinder y = cos x. (Use a graphing device to estimate the points of...

Prepare all necessary journal entries for 2016, 2017, and 2018 related to each of the following scenarios: a. On January 1, 2016, Sustco Ltd. purchased a piece of equipment for $21,000. At the time,...

Prepare all necessary journal entries for 2020, 2021, and 2022 related to each of the following scenarios: a. On January 1, 2020, Sustco Ltd. purchased a piece of equipment for $21,000. At the time,...

Bonds payable calculate market value. On March 1, 2005, Matt purchased $63,000 of Lawson Co.s 8%, 20-year bonds at face value. Lawson Co. has paid the annual interest due on the bonds regularly. On...

(Multiple choice) 1. What is the present value factor for an annuity of five periods and an interest rate of 10 percent? a. 1.6105 b. 6.1051 c. 3.7908 d. 7.7217 2. The university spirit organization...

As the time period for an NPV analysis gets longer, what happens to each incremental present value factor? Refer to a present value chart. At 15% interest, beyond what year do the discount factors...

Maurice has two gilt shops. He does not keep full accounting records but is able to provide the following information for the year ended 31 March 2015. The list of balances at 1 April 2014 and 31...

In one group, find a local business, such as a copy shop, that rents time on desktop computers for an hourly rate. Determine the hourly rate. In the other group, determine the price of a mid-range...

Compute the following present values: a. Present value of $8,000 to be received 15 years from now. The appropriate interest rate is 12%. b. Present value of $3,000 to be received at the end of each...

George Company manufactures a computer with an estimated economic life of 12 years and leases it to National Airlines for a period of 10 years. The normal selling price of the equipment is $278,072,...

The following information applies to the questions displayed below.] In each of the cases below, assume Division X has a product that can be sold either to outside customers or to Division Y of the...

Amy, the daughter of Amy's owners, believes that happiness does not come from money...she says it comes from meaning and purpose. If Amy's belief is based on her American culture, what ethical...

30. Question 30 Once every month, Adventure Works organizes a performance review meeting. This time, it's centered on the latest Microsoft Power BI reports you've crafted to understand market trends....

Explain what is meant by the "flaw of averages" when it comes to healthcare? How will "flaw of averages" influence our analytic approach in Healthcare? Provide a specific clinical or healthcare...

A zinc die casting has a critical dimension of 7.500 in when it solidifies in the mold at its melting temperature because 7.500 in is the corresponding mold dimension. What is the value of this part...

One of your colleagues is planning on changing (ie. altering the numbers) his collected data to make the data "say" what he wants the data to state. His plan is to submit the abstract to a national...

The price of a share of common stock is equal to the present value of all future dividends. O stable O expected O minimum O growing O paid

Difference between truncate & delete

Find a formula for the inverse of the function. f(x) = e 2x1

Evaluate the iterated integral. dx dy v3

Find parametric equations for the tangent line to the curve with the given parametric equations at the specified point. x = ln(t + 1), y = t cos 2 t , z = 2 t ; (0, 0, 1)

An analyst has timed a metal-cutting operation for 50 cycles. The average time per cycle was 10.40 minutes, and the standard deviation was 1.20 minutes for a worker with a performance rating of 125...

How are tools such as a process chart and a worker-machine chart useful?

How many work cycles should be timed to estimate tire average cycle time to within 2 percent of the sample mean with a confidence of 99 percent if a pilot study yielded these times (in minutes): 5.2,...