The initial measurement of right of use asset and lease liability. Given information: Lease term is 7 years. Annual rentals are $40,000 on 1/Jan each year. Implicit rate is 3.5%. Prepaid rent is $40,000. Incentive received is $15,000. Initial direct cost to lessee is $5,000.

Question

Want to see the full answer?

Answer 1

Question

Chapter 18, Problem 18.9E

a.

To determine

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

b.

To determine

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Subject = General Account

Roth Inc. has a deferred tax liability of $68,000 at the beginning of 2013. At the end of 2013, it reports accounts receivable on the books at $90,000 and the tax basis at zero (its only temporary difference). If the enacted tax rate is 34% for all periods, and income taxes payable for the period is $230,000, determine the amount of total income tax expense to report for 2013.(Subject:- General Account)

Calculate the selling price solution this question

Answer 2

Question

Chapter 18, Problem 18.9E

a.

To determine

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

b.

To determine

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 18, Problem 18.9E

a.

To determine

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

b.

To determine

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 18, Problem 18.9E

a.

To determine

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

b.

To determine

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 18, Problem 18.9E

a.

To determine

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

b.

To determine

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Answer 6

Chapter 18, Problem 18.9E

a.

To determine

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Answer 7

Chapter 18, Problem 18.9E

a.

To determine

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Answer 8

b.

To determine

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Answer 9

b.

To determine

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Answer 10

Expert Solution & Answer

Answer 11

Expert Solution & Answer

Answer 12

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 13

Ch. 18 - Does the lessee become the owner of the equipment...Ch. 18 - Prob. 18.2Q Ch. 18 - Prob. 18.3Q Ch. 18 - What are typical terms and provisions in a lease...Ch. 18 - How does a lease offer business and financial...Ch. 18 - Prob. 18.6Q Ch. 18 - How is the right-of-use asset measured?Ch. 18 - What components are included in a lease contract?Ch. 18 - How does a lessee separate lease and nonlease...Ch. 18 - How does a lessor separate lease and nonlease...

The initial measurement of right of use asset and lease liability. Given information: Lease term is 7 years. Annual rentals are $40,000 on 1/Jan each year. Implicit rate is 3.5%. Prepaid rent is $40,000. Incentive received is $15,000. Initial direct cost to lessee is $5,000.

Solution Summary: The author explains the calculation of lease liability and right of use asset. Journalizing is the process of recording the transactions of an organization in a chronological order.

Concept explainers

Videos

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

Want to see the full answer?

Chapter 18 Solutions

The initial measurement of right of use asset and lease liability. Given information: Lease term is 7 years. Annual rentals are $40,000 on 1/Jan each year. Implicit rate is 3.5%. Prepaid rent is $40,000. Incentive received is $15,000. Initial direct cost to lessee is $5,000.

Solution Summary: The author explains the calculation of lease liability and right of use asset. Journalizing is the process of recording the transactions of an organization in a chronological order.

Concept explainers

Videos

The initial measurement of right of use asset and lease liability. Given information: Lease term is 7 years. Annual rentals are $40,000 on 1/Jan each year. Implicit rate is 3.5%. Prepaid rent is $40,000. Incentive received is $15,000. Initial direct cost to lessee is $5,000.

To prepare: The journal entries for the lease transactions. Given information: Lease term is 7 years. Annual rentals are $40,000 on 1/Jan each year. Implicit rate is 3.5%. Prepaid rent is $40,000. Incentive received is $15,000. Initial direct cost to lessee is $5,000.

Want to see the full answer?

Chapter 18 Solutions

The initial measurement of right of use asset and lease liability.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.

To prepare: The journal entries for the lease transactions.

Given information:

Lease term is 7 years.

Annual rentals are $40,000 on 1/Jan each year.

Implicit rate is 3.5%.

Prepaid rent is $40,000.

Incentive received is $15,000.

Initial direct cost to lessee is $5,000.