Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Abbott Equipment leased a protein analyzer to Werner Chemical, Inc., on September 30, 2021. Abbott purchased the machine from NutraLabs, Inc., at a cost of

image text in transcribed

image text in transcribed Abbott Equipment leased a protein analyzer to Werner Chemical, Inc., on September 30, 2021. Abbott purchased the machine from NutraLabs, Inc., at a cost of $5.7 million. The five-year lease agreement calls for Werner to make quarterly lease payments of $371,970, payable each September 30, December 31, March 31, and June 30, with the first payment at September 30, 2021. Abbott's implicit interest rate is 12%. The useful life of the equipment is five years. (FV of \$1, PV of \$1, FVA of \$1, PVA of \$1, FVAD of \$1 and PVAD of \$1) (Use appropriate factor(s) from the tables provided.) Required: 1. What pretax amounts related to the lease would Abbott report in its balance sheet at December 31,2021 ? 2. What pretax amounts related to the lease would Abbott report in its income statement for the year ended December 31,2021 ? 3. What pretax amounts related to the lease would Abbott report in its statement of cash flows for the year ended December 31,2021 ? Complete this question by entering your answers in the tabs below. What pretax amounts related to the lease would Abbott report in its balance sheet at December 31, 2021 and income statement for the year ended December 31, 2021? (Enter your answer in whole dollars. Round your intermediate and final answers to nearest whole dollar.) Abbott Equipment leased a protein analyzer to Werner Chemical, Inc., on September 30, 2021. Abbott purchased the machine from NutraLabs, Inc., at a cost of $5.7 million. The five-year lease agreement calls for Werner to make quarterly lease payments of $371,970, payable each September 30, December 31, March 31, and June 30, with the first payment at September 30, 2021. Abbott's implicit interest rate is 12%. The useful life of the equipment is five years. (FV of \$1, PV of \$1, FVA of \$1, PVA of \$1, FVAD of \$1 and PVAD of \$1) (Use appropriate factor(s) from the tables provided.) Required: 1. What pretax amounts related to the lease would Abbott report in its balance sheet at December 31,2021 ? 2. What pretax amounts related to the lease would Abbott report in its income statement for the year ended December 31,2021 ? 3. What pretax amounts related to the lease would Abbott report in its statement of cash flows for the year ended December 31,2021 ? Complete this question by entering your answers in the tabs below. What pretax amounts related to the lease would Abbott report in its statement of cash flows for the year ended December 31 , 2021? (Enter your answer in whole dollars. Round your intermediate and final answers to nearest whole dollar.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Wiley CIA Essentials Of Internal Auditing Part 1 Exam Review 2023

Authors: S. Rao Vallabhaneni

1st Edition

1119987148, 978-1119987147

More Books

Students also viewed these Accounting questions

Question

the december 3 1 fair value adjustment is incorrrect

Answered: 1 week ago

Question

What is the role of the Joint Commission in health care?

Answered: 1 week ago