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can someone please answer the two questions below Chapter 17-Leases 89 On December 1, 20x11, XYZ leased office space for its own use for 10

can someone please answer the two questions below image text in transcribed
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Chapter 17-Leases 89 On December 1, 20x11, XYZ leased office space for its own use for 10 years at a monthly rental of $15,000. On December 31, 20x11, XYZ paid the lessor the following amounts: Refundable rent deposit (for possible property damage) First month's rent Rent for last month of year 10 (paid in advance) Installation of new walls and offices Total $20,000 15,000 15,000 96.000 $146,000 The entire amount of $146,000 was reported as rent expense in 20x11 because it is an operating lease. What amount should XYZ have reported as expense for the year ended December 31, 20x11? $15,000 B) $15,800 $30,800 $96,000 Ans: B Difficulty: Medium Level of Learning: Application Topic: LO1 Chapter 17-Leases 81 A company became a lessee by leasing equipment on January 1, 20x11 from a lessor. The lease has the following characteristics: Original useful life of asset Both lessor and lessee use 10% for lease capitalization Market value of equipment at lease inception Book value of equipment at lease inception Remaining useful life of equipment at inception A third party guarantees the entire residual value of 14 years $200,000 $150,000 10 years $31,887 Six end-of-year lease payments are due beginning December 31, 20x11 in the amount of The lease term ends December 31, 20x16 Assume this is a finance lease for both parties. What is the present value of minimum lease payments for the lessee? $200,000 $41,788 A) $181,998 B) $180,000 C) $194,566 $178,233 E) Ans: B Difficulty: Medium Level of Learning: Application Topic: LO2

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