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Firdavs [7]
3 years ago
6

A company leases trucks and properly classifies the leases as finance leases. The leases have a 10-year term, and the lease calc

ulations were done three years ago when interest rates were lower. Which of the following is the appropriate accounting treatment, if any, for the application of the fair value option to lease transactions?A. Recognize the change to fair value accounting with an unrealized loss in the income statement.B. Leases are not eligible for the fair value option.C. Recognize the change to fair value accounting with an unrealized loss in accumulated other comprehensive income.D. Recognize the change to fair value accounting with a cumulative adjustment to beginning retained earnings.
Business
1 answer:
pochemuha3 years ago
6 0

Answer:

D. Recognize the change to fair value accounting with a cumulative adjustment to beginning retained earnings.

Explanation:

In the situation whereby the 10 year term of the leased trucks value has adjusted leading to the increase in the interest rate of the lease, the best option would be recognize the change to fair value with its cummulative adjustment to beginning of the retained earnings.

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the answer is a survey about your income, expenses and assets

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3 years ago
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b.0.22

Explanation:

Return on investment (ROI) = Operating income/ Beginning Operating Asset = $ 92,000/ $440,000 = 0.22

8 0
3 years ago
West Corp. issued 13-year bonds 2 years ago at a coupon rate of 9.4 percent. The bonds make semiannual payments. If these bonds
finlep [7]

Answer:

9.68%

Explanation:

yield to maturity (YTM) = {coupon + [(face value - market value) / n]} / [(face value + market value) / 2]

face value = $1,000

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n = (13 - 2) x 2 = 22

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YTM = {$47 + [($1,000 - $980) / 22]} / [($1,000 + $980) / 2] = $47.9090 / $990 = 0.4839 x 2 (annual rate) = 0.09678 = 9.68%

4 0
3 years ago
FIFO Perpetual Inventory The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending Ju
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$32,864.00

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check the file attached below for full explanation

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4 0
2 years ago
Suppose that there is asymmetric information in the market for used cars. Sellers know the quality of the car that they are​ sel
zepelin [54]

Answer:

$22,500

Explanation:

Chance of getting low quality car = 50%

Chance of getting high quality car = 50%

Cost of low quality car = $15,000

Cost of high quality car = $30,000

So, Price of the car = 50% of lower quality + 50% of higher quality

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=  $7,500 + $15,000

= $22,500

Hence, price of the used car will be $22,500.

3 0
3 years ago
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