1. On December 21, 2020, Silver Point Colected equipment from Stock Equiment Rental. Pertinent lease trotoction datort cu follow The estimated seven-year useful equiomentufe coincides with the lease term The first of the seven equal annual P200,000 lease payments was paid on December 31, 2020 Stocks. Implicit interest rate of 12 percent known to Silver Point Co. Silver Point Cas incremental borrowing rate is 14 percent. Present values of an annuity of 1 in advance for seven periods are 5.51 gt 12 percent and 4.89 at 14 percent Silver Point Co should record the equipment on the books of 2. Hook Company manufactures equipment that is sold or losed on December 31, 2020, Hook Company leased equipment to Keith Inc for a five-year period expiring December 31, 2025, at which date ownership of the leased asset will be transferred to Kelth Equal P40,000 payments under the lease ore due on December 31 of each year. The first payment was made on December 31, 2020, Collectibility of the remaining lease payments is reasonably assured, ond Hook Company has na material cost uncertaintles. The normal sales price of the equipment is P154,000 and cost is P120,000. For the year anded December 21, 2020, how much income should Hook Company recognize from the lease transaction 3. On March 1, 2020, Haystack, Inc became the lessee of new equipment under a noncurcalable sin-year lease. The total estimated economic ate of this equipment is ten years. The fair value of this equipment an March 1, 2020, was P100,000. The lease does not meet the criteria for classification as a finance lease with respect to transfer of ownership of the based osset, or bargain purchase option, or lease tam. Nevertheless, toystock, Inc. must closnity this lease as a finance lease at inception of the lease, the present value of the minimum lecun payments (excluding tutory costal is equal to at least 1. On December 21, 2020, Silver Point Colected equipment from Stock Equiment Rental. Pertinent lease trotoction datort cu follow The estimated seven-year useful equiomentufe coincides with the lease term The first of the seven equal annual P200,000 lease payments was paid on December 31, 2020 Stocks. Implicit interest rate of 12 percent known to Silver Point Co. Silver Point Cas incremental borrowing rate is 14 percent. Present values of an annuity of 1 in advance for seven periods are 5.51 gt 12 percent and 4.89 at 14 percent Silver Point Co should record the equipment on the books of 2. Hook Company manufactures equipment that is sold or losed on December 31, 2020, Hook Company leased equipment to Keith Inc for a five-year period expiring December 31, 2025, at which date ownership of the leased asset will be transferred to Kelth Equal P40,000 payments under the lease ore due on December 31 of each year. The first payment was made on December 31, 2020, Collectibility of the remaining lease payments is reasonably assured, ond Hook Company has na material cost uncertaintles. The normal sales price of the equipment is P154,000 and cost is P120,000. For the year anded December 21, 2020, how much income should Hook Company recognize from the lease transaction 3. On March 1, 2020, Haystack, Inc became the lessee of new equipment under a noncurcalable sin-year lease. The total estimated economic ate of this equipment is ten years. The fair value of this equipment an March 1, 2020, was P100,000. The lease does not meet the criteria for classification as a finance lease with respect to transfer of ownership of the based osset, or bargain purchase option, or lease tam. Nevertheless, toystock, Inc. must closnity this lease as a finance lease at inception of the lease, the present value of the minimum lecun payments (excluding tutory costal is equal to at least
