Applying New Lease Accounting Standards for Operating Leases On January 1 of the current year, CCH Corporation entered into the following lease contract. Based on the facts, CCH Corporation classifies the lease as an operating lease. Details of lease contract Leased asset Office space Lease term 5 years Annual lease payment $115,487 Upfront fees $10,000 Cost of debt capital 5% a. Determine the amount of the lease liability that CCH will add to its balance sheet at the inception of the lease. Amount of lease liability
Applying New Lease Accounting Standards for Operating Leases On January 1 of the current year, CCH Corporation entered into the following lease contract. Based on the facts, CCH Corporation classifies the lease as an operating lease. Details of lease contract Leased asset Office space Lease term 5 years Annual lease payment $115,487 Upfront fees $10,000 Cost of debt capital 5% a. Determine the amount of the lease liability that CCH will add to its balance sheet at the inception of the lease. Amount of lease liability
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 4RE: Use the information in RE20-3. Prepare the journal entries that Garvey Company would make in the...
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Applying New Lease Accounting Standards for Operating Leases
On January 1 of the current year, CCH Corporation entered into the following lease contract. Based on the facts, CCH Corporation classifies the lease as an operating lease.
Details of lease contract | ||
---|---|---|
Leased asset | Office space | |
Lease term | 5 | years |
Annual lease payment | $115,487 | |
Upfront fees | $10,000 | |
Cost of debt capital | 5% |
a. Determine the amount of the lease liability that CCH will add to its balance sheet at the inception of the lease.
Amount of lease liability | |
---|---|
|
b.
What amount will be added to the balance sheet as an asset?
Amount added as an asset | |
---|---|
|
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