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Having Trouble with this journal Entry! thank you Splish Brothers Company leases an automobile with a fair value of $13,924 from John Simon Motors, Inc.,
Having Trouble with this journal Entry! thank you
Splish Brothers Company leases an automobile with a fair value of $13,924 from John Simon Motors, Inc., on the following terms: 1. 2. 3. Non-cancelable term of 50 months. Rental of $280 per month (at the beginning of each month). (The present value at 0.5% per month is $12,422.) Splish Brothers guarantees a residual value of $1,580 (the present value at 0.5% per month is $1,231). Delaney expects the probable residual value to be $1,580 at the end of the lease term. Estimated economic life of the automobile is 60 months. Splish Brothers's incremental borrowing rate is 6% a year (0.5% a month). Simon's implicit rate is unknown. 4. 5. Record the first month's amortization on Splish Brothers's books (assume straight-line). (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 2 decimal places, e.g. 5,275.25.) Account Titles and Explanation Debit Credit Amortization Expense Right-of-Use AssetStep by Step Solution
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