Tamarisk Leasing Company signs a lease agreement on January 1, 2020, to lease electronic equipment to Carla Vista Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement: 1. Carla Vista has the option to purchase the equipment for $19,000 upon termination of the lease. It is not reasonably certain that Carla Vista will exercise this option. 2. The equipment has a cost of $180,000 and fair value of $233,500 to Tamarisk Leasing. The useful economic life is 2 years, with a residual value of $19,000. 3. Tamarisk Leasing desires to earn a return of 5% on its investment. 4. Collectibility of the payments by Tamarisk Leasing is probable. Click here to view factor tables. (a) Prepare the journal entries on the books of Tamarisk Leasing to reflect the payments received under the lease and to recognize income for the years 2020 and 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to 0 decimal places e.g. 5,275.) Date Account Titles and Explanation Debit Credit enter an account title for the journal entry on January 1 2020 enter a debit amount enter a credit amount enter an account title for the journal entry on January 1 2020 enter a debit amount enter a credit amount enter an account title for the journal entry on January 1 2020 enter a debit amount enter a credit amount enter an account title for the journal entry on January 1 2020 enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title
Tamarisk Leasing Company signs a lease agreement on January 1, 2020, to lease electronic equipment to Carla Vista Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement: 1. Carla Vista has the option to purchase the equipment for $19,000 upon termination of the lease. It is not reasonably certain that Carla Vista will exercise this option. 2. The equipment has a cost of $180,000 and fair value of $233,500 to Tamarisk Leasing. The useful economic life is 2 years, with a residual value of $19,000. 3. Tamarisk Leasing desires to earn a return of 5% on its investment. 4. Collectibility of the payments by Tamarisk Leasing is probable. Click here to view factor tables. (a) Prepare the journal entries on the books of Tamarisk Leasing to reflect the payments received under the lease and to recognize income for the years 2020 and 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to 0 decimal places e.g. 5,275.) Date Account Titles and Explanation Debit Credit enter an account title for the journal entry on January 1 2020 enter a debit amount enter a credit amount enter an account title for the journal entry on January 1 2020 enter a debit amount enter a credit amount enter an account title for the journal entry on January 1 2020 enter a debit amount enter a credit amount enter an account title for the journal entry on January 1 2020 enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount enter an account title
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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Question
Tamarisk Leasing Company signs a lease agreement on January 1, 2020, to lease electronic equipment to Carla Vista Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement:
Click here to view factor tables.
1. | Carla Vista has the option to purchase the equipment for $19,000 upon termination of the lease. It is not reasonably certain that Carla Vista will exercise this option. | |
2. | The equipment has a cost of $180,000 and fair value of $233,500 to Tamarisk Leasing. The useful economic life is 2 years, with a residual value of $19,000. | |
3. | Tamarisk Leasing desires to earn a return of 5% on its investment. | |
4. | Collectibility of the payments by Tamarisk Leasing is probable. |
Click here to view factor tables.
(a)
Prepare the journal entries on the books of Tamarisk Leasing to reflect the payments received under the lease and to recognize income for the years 2020 and 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to 0 decimal places e.g. 5,275.)
Date
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Account Titles and Explanation
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Debit
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Credit
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enter an account title for the
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enter a debit amount
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enter a credit amount
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enter an account title for the journal entry on January 1 2020
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enter a debit amount
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enter a credit amount
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enter an account title for the journal entry on January 1 2020
|
enter a debit amount
|
enter a credit amount
|
|
|
enter an account title for the journal entry on January 1 2020
|
enter a debit amount
|
enter a credit amount
|
|
|
enter an account title
|
enter a debit amount
|
enter a credit amount
|
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enter an account title
|
enter a debit amount
|
enter a credit amount
|
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enter an account title
|
enter a debit amount
|
enter a credit amount
|
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enter an account title
|
enter a debit amount
|
enter a credit amount
|
|
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enter an account title
|
enter a debit amount
|
enter a credit amount
|
|
|
enter an account title
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