Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Exercise 15-5 Sales-type lease: lessor; balance sheet and income statement effects [LO15-3] On June 30, 2018, Georgia Atlantic, Inc, leased warehouse equipment from Builders, Inc.
Exercise 15-5 Sales-type lease: lessor; balance sheet and income statement effects [LO15-3] On June 30, 2018, Georgia Atlantic, Inc, leased warehouse equipment from Builders, Inc. The lease agreement calls for Georgia- Atlantic to make semiannual lease poyments of $530.475 over n 4 year lease term, payable each June 30 and December 31, with the first peyment at June 30, 2018 Georgia Atlantics incremental batrowing rate is 100%, the same rote Buiders used to calculate lease payment amounts. Builders manufctured the equipment at cost of $3.1 million. EyofS- S EV SI P Ao S1. and PVAD of S) (Use appropriate factorla) from the tables provided.) d Required: 1. Determine the price at which Builders is Tselling the equipment (present value of the lease payments) at June 30 2018. 2. What amounts related to the lease would Builders report in ins balance sheet ot December 31, 2018 tignore taxes)? 3.what amounts related to the lease would Bulders reportin its income statement for the year ended December 31.2018 ignore report in ts income statement for the year ended December 31. 2018 (ignore taxes)? For all requirements, enter your answers in whole dollars and not in millions. Round your final answer to nearest whole doller.) 1 Present value 3500,016 2712,500 2Amount to be reported in the balance sheet Amount to be reported in the income 128,476 8
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started