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OlgaM077 [116]
3 years ago
7

ABC Company leased equipment to Best Corporation under a lease agreement that qualifies as a finance lease. The cost of the asse

t is $124,000. The lease contains a bargain purchase option that is effective at the end of the fifth year. The expected economic life of the asset is 10 years. The lease term is five years. The asset is expected to have a residual value of $2,400 at the end of 10 years. Using the straight-line method, what would Best record as annual amortization
Business
1 answer:
alexandr402 [8]3 years ago
7 0

$12120 is the annual amortization expense

<u>Explanation:</u>

The following formula is used to calculate the annual depreciation expense that will be recorded in the books of accounts

Depreciation = ( cost of the asset minus salvage value) divide by number of years.

Given data in the question: number of years = 10, cost of the asset = $124000, salvage value = $28000

Putting the figures in the formula,

Depreciation expense = ($124000 minus $28000) divide by 10

After solving, we get = $12120

Thus, annual depreciation expense = $12120

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A service was performed for a client with payment due in 30 days what accounts are affected
marshall27 [118]

Answer:

b) debit accounts receivable, credit capital

Explanation:

Performing service is part of normal business activities. It generates revenue for the business.

Once a service has been performed, revenue increases. Revenue is an equity account (it increases the owner's equity). An increase to an equity account is recorded by crediting the account.

The payment will be received in 30 days. This is an increase in accounts receivables ( asset account). An increase in assets is recorded as a debit.

3 0
2 years ago
The ABC Auto Supply Company of Burlington, Vermont, uses an e-commerce software program on its website to allow customers such a
timama [110]

Answer: B2B ( Business to business)    

Explanation:

The Business to business (B2B) is one of the marketing process in which the products are promoted to the other organization or any business by using the various types of business operations or functions.

The business to business marketing plays an important role as it allow various types of organization for expanding the business in the market.

According to the given question, the ABC auto supply is one of the firm that are basically using the E commerce software that allow the users or consumers for ordering their auto parts.

Therefore, The ABC company is basically follows the B2B business model.

4 0
3 years ago
You are thinking of purchasing a house. The house costs $350,000. You have $50,000 in cash that you can use as a down payment on
jeyben [28]

Answer:

$63,852

Explanation:

The computation is shown below:

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b) The Loan PV of payments is $3,00,000

c) And, the Balloon payment required is

= (Borrowed amount - loan PV payments) × (1 + rate of interest)^number of years

= ($300,000 - $291,612) × 1.07^30

= $63,852

5 0
3 years ago
According to smith, what does capitalism allow individuals to do that no other economic system allows
tiny-mole [99]
Smith states that capitalism allows individuals to prosper,<span> capitalism allows for such things as division of labor and the specialization that comes with it, this increases the productive efficiency of a nation which in turn increases its wealth and standing in the rest of the world.

</span>
5 0
3 years ago
A personal trainer is advising a client on caloric distribution. Which of the following falls within the Acceptable Macronutrien
Aleonysh [2.5K]

Answer: C. 0.3

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8 0
2 years ago
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