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Abbott Equipment leased a protein analyzer to Werner Chemical, Incorporated, on September 30, 2024. Abbott purchased the machine from NutraLabs, Incorporated, at a cost of
Abbott Equipment leased a protein analyzer to Werner Chemical, Incorporated, on September 30, 2024.
- Abbott purchased the machine from NutraLabs, Incorporated, at a cost of $5 million.
- The five-year lease agreement calls for Werner to make quarterly lease payments of $326,290, payable each September 30, December 31, March 31, and June 30, with the first payment on September 30, 2024.
- Abbott's implicit interest rate is 12%. The useful life of the equipment is five years.
- What pretax amounts related to the lease would Abbott report in its balance sheet on December 31, 2024?
- What pretax amounts related to the lease would Abbott report in its income statement for the year ended December 31, 2024?
- What pretax amounts related to the lease would Abbott report in its statement of cash flows for the year ended December 31, 2024?
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