Finance Company leased a glass bottom boat lo Florida Springs on January 1, 2017. The term of the nonancelable lease is 3 years and payments are required on January 1 of each year starting on January 2017. The following information relates to this agreement: Annual lease payments are $2,000. Finance Company's implicit interest rate is 10%. The boat has a fair market value of $5, 471 and Finance Company's cost is $5.471. The useful life years. The asset's residual value at the end of lease is estimated to be $0. The lessee docs not any amount of the residual value. The boat does not have to he returned to Finance Co. at the end lease. Collectibility of the payments is reasonably assured, and there are no important uncertainties surrounding the costs yet to be incurred by Finance Company. Answer the following questions related to Finance Company. On January 1, 2017 immediately before the first lease payment, what is the balance, if any, of: Lease Payments Receivable _____________ On January 1, 2017 immediately after the first lease payment, what is the balance, if any, of: Lease Payments Receivable _____________ On Finance Company's (lessor) income statement for year ended December 31, 2017, what amount any, related to the lease would appear: One or more amounts may be zero. Interest Revenue ___________ Rent Revenue Sales Revenue _________ Depreciation Expense (Boat) __________ Cost of Goods Sold ___________ Finance Company leased a glass bottom boat lo Florida Springs on January 1, 2017. The term of the nonancelable lease is 3 years and payments are required on January 1 of each year starting on January 2017. The following information relates to this agreement: Annual lease payments are $2,000. Finance Company's implicit interest rate is 10%. The boat has a fair market value of $5, 471 and Finance Company's cost is $5.471. The useful life years. The asset's residual value at the end of lease is estimated to be $0. The lessee docs not any amount of the residual value. The boat does not have to he returned to Finance Co. at the end lease. Collectibility of the payments is reasonably assured, and there are no important uncertainties surrounding the costs yet to be incurred by Finance Company. Answer the following questions related to Finance Company. On January 1, 2017 immediately before the first lease payment, what is the balance, if any, of: Lease Payments Receivable _____________ On January 1, 2017 immediately after the first lease payment, what is the balance, if any, of: Lease Payments Receivable _____________ On Finance Company's (lessor) income statement for year ended December 31, 2017, what amount any, related to the lease would appear: One or more amounts may be zero. Interest Revenue ___________ Rent Revenue Sales Revenue _________ Depreciation Expense (Boat) __________ Cost of Goods Sold ___________
