Question
The Company leased equipment from America Industries on January 1, 2021. America manufacturedthe equipment at a cost of $270,000. Other information: Lease term 3 years
The Company leased equipment from America Industries on January 1, 2021. America manufacturedthe equipment at a cost of $270,000.
Other information:
| Lease term | 3 years |
| Annual payments | $120,000 beginning Jan. 1, 2021 |
| Life of asset | 3 years |
| Lessor's implicit interest rate | 8% |
| Lessee's incremental rate | 9% |
Required:
Round your answers to the nearest whole dollar amounts.
Calculate the amount of lease receivable that America would report in this sales-type lease. Round to nearest dollar. Show calculations. If not, no credit.
Prepare the appropriate journal entries for america on January 1, 2021. Round to nearest dollar..
Prepare the adusting journal entry for America on December 31, 2021. Round to nearest dollar.
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Using Financial Accounting Information The Alternative to Debits and Credits
Authors: Gary A. Porter, Curtis L. Norton
7th Edition
978-0-538-4527, 0-538-45274-9, 978-1133161646
