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stira [4]
3 years ago
8

On January 1, Year 1, Michael sold a property with a remaining useful life of 20 years to Wei Co. for $800,000. On the same date

, Michael leased back the property from Wei for 18 years. The lease was properly classified by Michael as a finance lease. Michael is not sure how to recognize the $800,000 received from Wei Co. on January 1, Year 1.
Required:
Which section of the Accounting Standards Codification best helps Michael Co. determine how the initial proceeds of $800,000 received from Wei Co. (buyer-lessor) are recognized?
Business
1 answer:
dezoksy [38]3 years ago
5 0

Answer:

The section of the Accounting Standards Codification that best helps Michael Co. to determine how the initial proceeds of $800,000 received from Wei Co. (buyer-lessor) are recognized is:

ASC 606.

Explanation:

This section that will help Michael Co. to determine if the transaction qualifies as a sale, which is treated under ASC 606, Revenues from Contracts with Customers.  Thereafter, the lease classification criteria in ASC 842 are evaluated.  After the evaluation, if none of the criteria from ASC 842 are met to account for the lease as a finance or capital lease, the seller-lessee would classify the lease as an operating lease.  This implies that the transaction qualifies as a sale and leaseback transaction.

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Explanation:

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The states have different corporate values and therefore will pass different laws to treat limited liability companies based on these values. These laws and statutes will therefore by extension, vary just as the values vary.

For this reason, the law governing LLCs in the different states is not uniform.

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3 years ago
Studies show that OSHA employees fail to properly inspect and regulate many workplaces, primarily because they do not have _____
Viefleur [7K]

Answer:

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sufficient resources.

Explanation:

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3 years ago
Old Corp. (target) merges into New Corp (acquiring) in a statutory Type A merger. What will the basis in Old Corp.'s assets be i
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Answer:

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5 0
4 years ago
The expansionary phase of the business cycle is characterized by
Leokris [45]

Answer:

<u>increasing real output and reducing unemployment</u>

Explanation:

The expansionary phase of the cycle is business characterized by the i<em><u>ncreasing real output and reducing unemployment.</u></em>

<em> Business cycle refers to that cycle in which there is increase and decrease or fall and rise of output of goods and services.</em>

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3 years ago
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In this stage the performance of team starts declining due to lack of harmony and trust among the members of the team.  In the given case, Roger's team has been facing conflict over the controlling issues ,hence, we can conclude that they are at storming stage of development.

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