(Learning Objective 3: Recording Operating and Capital lease) Gary Pan Enterprises entered into two lease agreements for...
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(Learning Objective 3: Recording Operating and Capital lease) Gary Pan Enterprises entered into two lease agreements for 5 years on January 1, 20X0. Both leases require a payment of $10,000 per year at the end of each year. Lease 1 is structured as an operating lease whilst Lease 2 is structured as a capital lease with an implicit interest rate of 5%. Prepare all relevant journal entries for both leases on:
a. The day of signing the lease contract
b. The day of the fi rst lease payment
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Related Book For
Financial Accounting International Financial Reporting Standards
ISBN: 9780273777809
1st Global Edition
Authors: Walter T Harrison, Charles Horngren, Bill Thomas, Themin Suwardy
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