Oriole Corporation enters into a 6-year lease of equipment on December 31, 2024, which requires 6 annual payments of $36,300 each, beginning December 31, 2024. In addition, Oriole guarantees the lessor a residual value of $18,400 at the end of the lease. However, Oriole 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 6 years. Prepare Orioles' December 31, 2024, journal entries, assuming the implicit rate of the lease is 11% and this is known to Oriole. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to O decimal places e.g. 5,275.) Click here to view factor tables
Oriole Corporation enters into a 6-year lease of equipment on December 31, 2024, which requires 6 annual payments of $36,300 each, beginning December 31, 2024. In addition, Oriole guarantees the lessor a residual value of $18,400 at the end of the lease. However, Oriole 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 6 years. Prepare Orioles' December 31, 2024, journal entries, assuming the implicit rate of the lease is 11% and this is known to Oriole. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to O decimal places e.g. 5,275.) Click here to view factor tables
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 12P: Comprehensive Landlord Company and Tenant Company enter into a noncancelable, direct financing lease...
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