Business, 04.05.2021 18:50 mathater15
On January 1, 2017, Burke Corporation signed a 5 year noncancelable lease for a machine. The terms of the lease called for Burke to make annual payments of $8,668 at the beginning of each year, starting January 1, 2017. The machine has an estimated useful life of 6 years and a $5,000 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Burke uses the straight-line method of depreciation for all of its plant assets. Burke's incremental borrowing rate is 10%, and the lessor's implicit rate is unknown.
(a) What type of lease is this? Explain.
(b) Compute the present value of the lease payments.
(c) Prepare all necessary journal entries for Burke for this lease through January 1, 2018.
Answers: 2
Business, 21.06.2019 23:00
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Business, 22.06.2019 18:50
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Business, 22.06.2019 20:40
Cherokee inc. is a merchandiser that provided the following information: amount number of units sold 20,000 selling price per unit $ 30 variable selling expense per unit $ 4 variable administrative expense per unit $ 2 total fixed selling expense $ 40,000 total fixed administrative expense $ 30,000 beginning merchandise inventory $ 24,000 ending merchandise inventory $ 44,000 merchandise purchases $ 180,000 required: 1. prepare a traditional income statement. 2. prepare a contribution format income statement.
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On January 1, 2017, Burke Corporation signed a 5 year noncancelable lease for a machine. The terms o...
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