Question
21 ---------------------------------------------------------------------------------------------------------------------------- 21-27 28. The methods of accounting for a lease by the lessee are 21-28 52. On December 1, 2xx1, Goetz Corporation leased office
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21-27 28. The methods of accounting for a lease by the lessee are
21-28 52. On December 1, 2xx1, Goetz Corporation leased office space for 10 years at a monthly rental of $xx,000. On that date Perez paid the landlord the following amounts:
Rent deposit $ xx,000
First month's rent xx,000
Last month's rent xx,000
Installation of new walls and offices xx,000
$xxx,000
The entire amount of $xxx,000 was charged to rent expense in 2xx1. What amount should Goetz have charged to expense for the year ended December 31, 2xx1?
21-29 64. On December 31, 2xx1, Kuhn Corporation leased a plane from Bell Company for an eight-year period expiring December 30, 2xx9. Equal annual payments of $1xx,000 are due on December 31 of each year, beginning with December 31, 2xx1. The lease is properly classified as a capital lease on Kuhns books. The present value at December 31, 2xx1 of the eight lease payments over the lease term discounted at xx% is $xx,264. Assuming the first payment is made on time, the amount that should be reported by Kuhn Corporation as the lease liability on its December 31, 2xx2 balance sheet is
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