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devlian [24]
3 years ago
9

On 1 July 2019, Fisher Ltd decides to lease a cargo ship from XFinance Ltd. The term of the lease is 20

Business
1 answer:
Alla [95]3 years ago
4 0

Answer:

a.  FV of Lease Payment=2215552

b.                                   Debit Credit

Recognition of Lease  

01-Jul-19 ROU Asset $2215560  

Lease Liability               $2215560

30-Jun-20 Recording Lease Payment  

Lease Liability $225000  

Lease Expense $25000  

               Bank           $250000

30-Jun-20 Recording Interest  

Interest Expense $199056  

Lease Liability        $199056

c.                                    Debit    Credit

Recognition of Lease  

Lease Receivable $2215560  

ROU Asset              $2215560

30-Jun-20 Recording Lease receipt  

Bank             $250000  

Fisher Ltd                  $25000

Lease Receivable         $225000

30-Jun-20 Maintainace Expense  

Lease Expense$25000  

Bank                   $25000

Fisher Ltd $25000  

Lease Expense  $25000

30-Jun-20 Recording Interest  

Lease Receivable $199056  

Interest Expense  $199056

Explanation:

According to the given data Interest rate implict in the lease = 10%

Year  Lease Discounting PV of Lease Payment

                        Factor 10%

0 300000 1.0000 300000

1 225000 0.9091 204545

2 225000 0.8264 185950

3 225000 0.7513 169046

4 225000 0.6830 153678

5 225000 0.6209 139707

6 225000 0.5645 127007

7 225000 0.5132 115461

8 225000 0.4665 104964

9 225000 0.4241 95422

10 225000 0.3855 86747

11 225000 0.3505 78861

12 225000 0.3186 71692

13 225000 0.2897 65174

14 225000 0.2633 59250

15 225000 0.2394 53863

16 225000 0.2176 48967

17 225000 0.1978 44515

18 225000 0.1799 40468

19 225000 0.1635 36789

20 225000 0.1486 33445

a. FV of Lease Payment=2215552

b. Journal Entry  In the books of Fisher Ltd.

                                      Debit Credit

Recognition of Lease  

01-Jul-19 ROU Asset $2215560  

Lease Liability               $2215560

30-Jun-20 Recording Lease Payment  

Lease Liability $225000  

Lease Expense $25000  

               Bank           $250000

30-Jun-20 Recording Interest  

Interest Expense $199056  

Lease Liability        $199056

c.Journal Entry

                                     Debit    Credit

Recognition of Lease  

Lease Receivable $2215560  

ROU Asset              $2215560

30-Jun-20 Recording Lease receipt  

Bank             $250000  

Fisher Ltd                  $25000

Lease Receivable         $225000

30-Jun-20 Maintainace Expense  

Lease Expense$25000  

Bank                   $25000

Fisher Ltd $25000  

Lease Expense  $25000

30-Jun-20 Recording Interest  

Lease Receivable $199056  

Interest Expense  $199056

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Blossom Corp. has collected the following data concerning its maintenance costs for the past 6 months.
soldier1979 [14.2K]

Answer:

Variable  cost per unit = $1.5  per unit

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Explanation:

Variable cost per unit

= cost at high activity - cost at low activity/High activity -low activity

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5 0
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Grayson (single) is in the 24 percent tax rate bracket and has sold the following stocks in 2019: (Loss amounts should be indica
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Answer:

$8,940

Explanation:

For computing the amount of the gain first we have to need to do the following calculations

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7 0
3 years ago
. Underwater Experimental is considering a project which requires the purchase of $498,000 of fixed assets. The net present valu
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Answer:

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3 years ago
The bookkeeper at Jefferson Company has not reconciled the bank statement with the Cash account, saying, "I don't have time." Yo
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The April ledger accounts for cash showed  is :

JEFFERSON COMPANY

Bank Reconciliation, April 30, Current Year

Company's Books Bank Statement

Ending balance per cash account   26100 Ending balance per bank statement   23690

Additions:     Additions:    

Interest collected 1320   Deposits in transit 7200  

         

   1320     7200

   27420     30890

Deductions:     Deductions:    

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Bank charges 60        

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2 Accounts Receivable—A. B. Wright 270  

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3 Bank service charge expense 60  

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