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On January 1, 2021, Boss Company leased a machinery to another entity with the following details: Cost of machinery Residual Value guarantee Lease term
On January 1, 2021, Boss Company leased a machinery to another entity with the following details: Cost of machinery Residual Value guarantee Lease term Useful life of the machinery Implicit interest rate (round of PVF to four (4) decimal places) The annual rental is payable in advance on January 1 of each year starting January 1, 2021. 1,880,050 200,000 4 years 4 years 10% REQUIRED: 1. ANNUAL RENTAL 2. UNEARNED INTEREST INCOME 3. AMORTIZATION TABLE 4. JOURNAL ENTRIES
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To calculate the required information we can use the following formulas 1 Annual Rental Annual Rental Cost of machinery Residual Value guarantee PVF f...
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Intermediate Accounting Reporting and Analysis
Authors: James M. Wahlen, Jefferson P. Jones, Donald Pagach
2nd edition
9781305727557, 1285453824, 9781337116619, 130572755X, 978-1285453828
