The following information relates to a capital lease between Glass Electric Co. (lessee) and Williams Manufacturing Inc.

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The following information relates to a capital lease between Glass Electric Co. (lessee) and Williams Manufacturing Inc. (lessor). The lease term began on January 1, 2013. Glass capitalized the 10-year lease and recorded $150,000 as an asset. The annual lease payment, made at the beginning of each year, is $22,193 at 10% interest. Glass uses the straight-line method to depreciate its owned assets. How will this lease be reported on Glass' statement of cash flows for 2013 if the second lease payment is made on December 31, 2013, and Glass uses the indirect method?
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Intermediate Accounting

ISBN: 978-0538479738

18th edition

Authors: Earl K. Stice, James D. Stice

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