Question

Data Warehouse Corporation recorded a right-of-use asset for $210,000 as a result of a finance lease...

Data Warehouse Corporation recorded a right-of-use asset for $210,000 as a result of a finance lease on December 31, 2016. Data Warehouse’s incremental borrowing rate is 8%, and the implicit rate of the lessor was not known at the commencement of the lease. Data Warehouse Corporation made the first lease payment of $48,700 on December 31, 2016. The lease requires 5 annual payments. The equipment has a useful life of 5 years with no residual value. Prepare Data Warehouse Corporation’s December 31, 2017 adjusting entries.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Feel free to ask any clarification if required. Please provide feedback by thumbs up if satisfied. It will be highly appreciated. Thank you.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
On December 31, 2016, Sage Hill Corporation signed a 5-year, non-cancelable lease for a machine. The...
On December 31, 2016, Sage Hill Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called for Sage Hill to make annual payments of $8,026 at the beginning of each year, starting December 31, 2016. The machine has an estimated useful life of 6 years and a $4,900 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Sage Hill uses the straight-line method of depreciation for all...
On December 31, 2016, Tamarisk Corporation signed a 5-year, non-cancelable lease for a machine. The terms...
On December 31, 2016, Tamarisk Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called for Tamarisk to make annual payments of $8,978 at the beginning of each year, starting December 31, 2016. The machine has an estimated useful life of 6 years and a $5,200 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Tamarisk uses the straight-line method of depreciation for all of its plant...
Sunland Corporation enters into a 7-year lease of equipment on December 31, 2016, which requires 7...
Sunland Corporation enters into a 7-year lease of equipment on December 31, 2016, which requires 7 annual payments of $39,300 each, beginning December 31, 2016. In addition, Sunland guarantees the lessor a residual value of $19,200 at the end of the lease. However, Sunland believes it is probable that the expected residual value at the end of the lease term will be $9,200. The equipment has a useful life of 7 years. Prepare Sunlands' December 31, 2016, journal entries assuming...
Macinski Leasing Company Leases a new machine to Sharrer Corporation. The machine has a cost of...
Macinski Leasing Company Leases a new machine to Sharrer Corporation. The machine has a cost of $70,000 and fair value of $95,000. Under the 3 year, non-cancelable contract, Sharrer will receive title to the machine at the end of the lease. The machine has a 3 year useful life and no residual value. The lease was signed on January 1, 2017. Macinski expects to earn an 8% return on its investment, and this implicit rate is known by Sharrer. The...
1.Red Co. recorded a right-of-use asset of $180,000 in a 10-year finance lease. Payments of $29,294...
1.Red Co. recorded a right-of-use asset of $180,000 in a 10-year finance lease. Payments of $29,294 are made annually at the end of each year. The interest rate charged by the lessor was 10%. The balance in the lease payable after two years will be: (Round your final answer to nearest whole dollar.) 2.On January 1, 2018, Packard Corporation leased equipment to Hewlitt Company. The lease term is 11 years. The first payment of $453,000 was made on January 1,...
On 1/1/16, black co. (lessee) recorded a right of use asset of $100,000 for a 10-year...
On 1/1/16, black co. (lessee) recorded a right of use asset of $100,000 for a 10-year lease agreement. payments of $12,575 are made annually at the beginning of each rental year, with the first payment paid on 1/1/16. the lessor’s implicit rate is 5.5%, which approximates Black’s incremental borrowing rate. Black classifies the lease as a finance lease, but not as a result of a bargain purchase option or title transfer. the leased equipment has an estimated useful life of...
1. The methods of accounting for a lease by a lessee are a. operating and sales-type...
1. The methods of accounting for a lease by a lessee are a. operating and sales-type lease methods. b. operating and finance lease methods. c. operating and direct financing lease methods. d. none of these answers are correct.     2.     In computing the present value of the lease payments, the lessee should a.   use its incremental borrowing rate in all cases. b.   use both its incremental borrowing rate and the implicit rate of the lessor, assuming that the implicit rate...
Red Co. recorded a right-of-use asset of $145,000 in a 10-year finance lease. Payments of $23,598...
Red Co. recorded a right-of-use asset of $145,000 in a 10-year finance lease. Payments of $23,598 are made annually at the end of each year. The interest rate charged by the lessor was 10%. The balance in the lease payable after two years will be: (Round your final answer to nearest whole dollar.)
eal Corporation enters into a 7-year lease of equipment on December 31, 2019, which requires 7...
eal Corporation enters into a 7-year lease of equipment on December 31, 2019, which requires 7 annual payments of $41,100 each, beginning December 31, 2019. In addition, Teal guarantees the lessor a residual value of $18,400 at the end of the lease. However, Teal believes it is probable that the expected residual value at the end of the lease term will be $9,200. The equipment has a useful life of 7 years. Prepare Teals' December 31, 2019, journal entries assuming...
On January 1, 2017, Windsor Corporation signed a 5-year noncancelable lease for a machine. The terms...
On January 1, 2017, Windsor Corporation signed a 5-year noncancelable lease for a machine. The terms of the lease called for Windsor to make annual payments of $8,634 at the beginning of each year, starting January 1, 2017. The machine has an estimated useful life of 6 years and a $4,900 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Windsor uses the straight-line method of depreciation for all of its plant...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT