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21-14 Hi I need help with the questions attached thanks Exercise 21-14 On February 20, 2017, Swifty Inc. purchased a machine for $1,564,800 for the
21-14
Hi I need help with the questions attached thanks
Exercise 21-14 On February 20, 2017, Swifty Inc. purchased a machine for $1,564,800 for the purpose of leasing it. The machine is expected to have a 10-year life, no residual value, and will be depreciated on the straight-line basis. The machine was leased to Nash Company on March 1, 2017, for a 4-year period at a monthly rental of $20,800. There is no provision for the renewal of the lease or purchase of the machine by the lessee at the expiration of the lease term. Swifty paid $31,680 of commissions associated with negotiating the lease in February 2017. (a) What expense should Nash Company record as a result of the facts above for the year ended December 31, 2017? $ Rent Expense (b) What income or loss before income taxes should Swifty record as a result of the facts above for the year ended December 31, 2017? (Hint: Amortize commissions over the life of the lease.) Income from lease before taxes $Step by Step Solution
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