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juin [17]
3 years ago
8

Rauch Incorporated leases a piece of equipment to Donahue Corporation on January 1, 2017. The lease agreement called for annual

rental payments of $4,892 at the beginning of each year of the 4-year lease. The equipment has an economic useful life of 6 years, a fair value of $25,000, a book value of $20,000, and both parties expect a residual value of $8,250 at the end of the lease term, though this amount is not guaran- teed. Rauch set the lease payments with the intent of earning a 5% return, and Donahue is aware of this rate. There is no bargain purchase option, ownership of the lease does not transfer at the end of the lease term, and the asset is not of a specialized nature.
Instructions:
(a) Explain (and show calculations) how Rauch arrived at the amount of the rental payments used in the lease agreement.
(b) Prepare the entries for Rauch for 2017.
(c) Suppose that instead of $8,250, Rauch expects the residual value at the end of the lease to be $5,000, but Donahue agrees to guarantee a residual value of $8,250. All other facts being equal, how would Rauch change the amount of the annual rental payments, if at all?
(d) Explain how a fully guaranteed residual value by Donahue would change the accounting for Rauch, the lessor.
(e) Explain how a bargain renewal option for one extra year at the end of the lease term would change the accounting of the lease for Rauch, the lessor.
Business
1 answer:
REY [17]3 years ago
6 0

Answer:

87 because he

Explanation: add then multiply;

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natka813 [3]

Answer:

A;36

Explanation:

So lets recall the different parts of a box and whisker plot.

The dot at the very right end of it is the maximum, where the largest number is.

After that, the box to the right is the upper quartile.

On the left, the box on the left is the lower quartile.

In between the right and left of the box is the median, which seperates the upper quartile by the lower quartile.

Finally, we have the dot farthest to the left, which is the minimum.

So on our box and whisker chart, lets look at the dot farthest to our left, since thats the minimum.

<u>This should be 36.</u>

Hope this helps! ;)

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Degger [83]
The last one would most likely be it
4 0
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ki77a [65]

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telo118 [61]

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