Question
Company A started at the beginning of 2019. They entered into a lease with Jan 1st as both inception and commenment date The Lease term
Company A started at the beginning of 2019. They entered into a lease with Jan 1st as both inception and commenment date The Lease term is as below - 5 yr non-cancellable - 5% interest rate - equal payment of $22916.51 at the end of each year - $1,000 bargining purchase option at the end of lease term Useful life of this asset is 6 years with 0 residual value
Tax rate 25%, 30% and 35% each of the year
Earnings before interest, amortization and taxes for each year | |
2019 | $123,456 |
2020 | $234,567 |
2021 | $345,678 |
Requests a) Prepare amortization table for the lease b) Record all related Jes c) Complete the balance sheet
Balance Sheet | |||
2019 | 2020 | 2021 | |
Asset | |||
Current Asset | |||
Cash | ? | ? | ? |
Accounts Receivable | 120000 | 100000 | 150000 |
Prepaid Expenses | 8000 | 5000 | 2000 |
Future Tax Asset | ? | ? | ? |
Long-term Asset | |||
? | |||
Total Assets | |||
Liabilities | |||
Current Liabilities | |||
Accounts Payable | 100000 | 80000 | 90000 |
Unearned Revenue | 10000 | 8000 | 12000 |
Future Tax Liabilities | ? | ? | ? |
Long-term Liabilities | |||
? | |||
Total Liability | |||
Shareholders' Equity | |||
Retained Earnings | ? | ? | ? |
Common Equity | 200000 | 200000 | 200000 |
Total Shareholders' Equity | |||
Total Liability and Equity | |||
Please explain step by step with the formulas.
Please explain with details and formulas how you calculate Future Tax Asset, Long Term Liabilities, Cash.
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