Question
Bayou inc. leases equipment to its customers under non-cancelable leases. On January 1, 2014, bayou leased equipment costing $400,000 to Rockwell co., for nine years.
Bayou inc. leases equipment to its customers under non-cancelable leases. On January 1, 2014, bayou leased equipment costing $400,000 to Rockwell co., for nine years. the rental cost was $44,000 payable in advance semiannually (January 1 and July 1), plus $2,000 semiannually for executor costs. the equipment had an estimated life of 15 years and sold for $533,025 with an estimated unguaranteed residual value of $80,000. The implicit interest rate is 12 percent.
Prepare all journal entries for 2014 on bayou's and Rockwell’s books.
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Bayou Inc Books Lessor 2014 Jan 1 Lease Payments Receivable 44000 x 18 months x 80000 872000 Cost of ...Get Instant Access to Expert-Tailored Solutions
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, and Terry D. Warfield
15th edition
978-1118159644, 9781118562185, 1118159640, 1118147294, 978-1118147290
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