Principles of Financial Accounting.
22nd Edition
ISBN: 9780077632892
Author: John J. Wild
Publisher: McGraw Hill
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Chapter 14, Problem 18QS
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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
The rest of the questions are given in pictures below. please answer all parts correctly. i will upvote. thank you!!
Recording Operating Lease Journal Entries-Lessee
Lessor Co. enters into an operating lease of property with Lessee Co. on January 1 for a five-year
term at an annual fixed lease payment of $10,000 (with beginning of year payments). Prepare the
journal entries for the lessee assuming that the lessee is aware of the rate implicit in the lease of
5%.
a. January 1-Record the right-of-use asset.
b. January 1-Record the first lease payment.
c. December 31-Record the year-end adjusting entry.
• Note: Round your answers to the nearest whole dollar.
Date
a) Jan. 1
b) Jan. 1
c) Dec. 31
Check
Account Name
Right-of-Use Asset
To record the right-of-use asset
To record the first lease payment
To record the year-end adjusting entry.
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Algoma, Inc., signs a five-year lease for office equipment with Office Solutions. The present value of the lease payments is $15,499. Prepare the journal entry that Algoma records at the inception of this finance lease.
Chapter 14 Solutions
Principles of Financial Accounting.
Ch. 14 - A bond traded at 97 means that a. The bond pays...Ch. 14 - Prob. 2MCQCh. 14 - Prob. 3MCQCh. 14 - Prob. 4MCQCh. 14 - Prob. 5MCQCh. 14 - Prob. 1DQCh. 14 - Prob. 2DQCh. 14 - Prob. 3DQCh. 14 - Prob. 4DQCh. 14 - Prob. 5DQ
Ch. 14 - Prob. 6DQCh. 14 - Prob. 7DQCh. 14 - Prob. 8DQCh. 14 - Prob. 9DQCh. 14 - Prob. 10DQCh. 14 - Prob. 11DQCh. 14 - Prob. 12DQCh. 14 - Prob. 13DQCh. 14 - Prob. 14DQCh. 14 - Prob. 15DQCh. 14 - Prob. 16DQCh. 14 - Prob. 17DQCh. 14 - Prob. 18DQCh. 14 - Prob. 19DQCh. 14 - Prob. 20DQCh. 14 - Bond financing Identify the following as either an...Ch. 14 - Prob. 2QSCh. 14 - Prob. 3QSCh. 14 - Prob. 4QSCh. 14 - Prob. 5QSCh. 14 - Prob. 6QSCh. 14 - Prob. 7QSCh. 14 - Prob. 8QSCh. 14 - Prob. 9QSCh. 14 - Prob. 10QSCh. 14 - Prob. 11QSCh. 14 - Bond features and terminology Enter the letter of...Ch. 14 - Prob. 13QSCh. 14 - Prob. 14QSCh. 14 - Prob. 15QSCh. 14 - Prob. 16QSCh. 14 - Prob. 17QSCh. 14 - Prob. 18QSCh. 14 - Prob. 19QSCh. 14 - Prob. 20QSCh. 14 - Prob. 1ECh. 14 - Prob. 2ECh. 14 - Prob. 3ECh. 14 - Prob. 4ECh. 14 - Prob. 5ECh. 14 - Prob. 6ECh. 14 - Prob. 7ECh. 14 - Prob. 8ECh. 14 - Prob. 9ECh. 14 - Prob. 10ECh. 14 - Prob. 11ECh. 14 - Prob. 12ECh. 14 - Prob. 13ECh. 14 - Prob. 14ECh. 14 - Prob. 15ECh. 14 - Prob. 16ECh. 14 - Prob. 17ECh. 14 - Prob. 18ECh. 14 - Prob. 19ECh. 14 - Prob. 20ECh. 14 - Prob. 1APCh. 14 - Prob. 2APCh. 14 - Prob. 3APCh. 14 - Prob. 4APCh. 14 - Prob. 5APCh. 14 - Prob. 6APCh. 14 - Prob. 7APCh. 14 - Prob. 8APCh. 14 - Prob. 9APCh. 14 - Prob. 10APCh. 14 - Prob. 11APCh. 14 - Prob. 1BPCh. 14 - Prob. 2BPCh. 14 - Prob. 3BPCh. 14 - Prob. 4BPCh. 14 - Prob. 5BPCh. 14 - Prob. 6BPCh. 14 - Prob. 7BPCh. 14 - Prob. 8BPCh. 14 - Prob. 9BPCh. 14 - Prob. 10BPCh. 14 - Prob. 11BPCh. 14 - Prob. 14SPCh. 14 - Prob. 1BTNCh. 14 - Prob. 2BTNCh. 14 - Prob. 3BTNCh. 14 - Prob. 4BTNCh. 14 - Prob. 5BTNCh. 14 - Prob. 7BTNCh. 14 - Prob. 9BTN
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- Use the information in RE20-3. Prepare the journal entries that Garvey Company would make in the first year of the lease assuming the lease is classified as a finance lease. Assume that Garvey is required to make payments on December 31 each year.arrow_forwardUse the information in RE20-3. Prepare the journal entries that Garvey Company would make in the first year of the lease assuming the lease is classified as a finance lease. However, assume that Garvey is now required to make the 65,949.37 payments on January 1 each year and that the fair value at the lease inception is now 275,000 (65,949:37 4:169865).arrow_forwardReporting a Finance Lease Pier10 Inc. entered into a five-year lease and recorded a right-of-use asset and lease liability of $88,000 on January 1. Pier10 Inc. was aware of the lessor's implicit rate of interest of 5%. The equipment under lease ha an estimated five-year useful life with no residual value. The first lease payment of $19,358 was due upon commencement of the lease. Show the balance sheet presentation on December 31, and the income statement presentation for the year ended December 31. Note: Round your answers to the nearest whole dollar.. Note: Do not use negative signs with your answers. Assets Balance Sheet Noncurrent assets: Right-of-Use Asset Liabilities Current liabilities: Lease Liability Noncurrent liabilities: Lease Liability Income Statement December 31 88,000 * 19,358 ✓ 0 % December 31 Expenses Interest Expense $ 3,432 ✔ Amortization Expense 17,600 ✓arrow_forward
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