>> Accounting Basics
On Feb 20 2011 Hooke Inc purchased a machine for $1200000 for the purpose of leasing it. The machine is epected tohave a 10 year life ,noresidual value and will be depreciated on the straightline basis. The machine was leased to Sage company on March 01 2011 for a 4 year period at monthly rental of $15600. There is no provision for the renewal of the lease or purchase of the machine by the lessee at the expiration of the lease term. Hooke paid n$ 30000 of commissions associated with negotiating the lease in Feb 2011
A. What expense shoukd sage record as a result of the facts above for the year ended DEC 31 2011,show supporting computations in good form.
B. What income or loss before income taxes should hooke record as a result for the facts above for the year ended DeC 31 2011