### Compute the amount of the annual rental payment make all

Assignment Help Accounting Basics
##### Reference no: EM13396988

On January 1, 2012, Palmer Company leased equipment to Woods Corporation. The following information pertains to this lease.

1. The term of the noncancelable lease is 6 years, with no renewal option. The equipment reverts to the lessor at the termination of the lease.

2. Equal rental payments are due on January 1 of each year, beginning in 2012.

3. The fair value of the equipment on January 1, 2012, is \$232,200, and its cost is \$190,404.

4. The equipment has an economic life of 8 years, with an unguaranteed residual value of \$10,940. Woods depreciates all of its equipment on a straight-line basis.

5. Palmer sets the annual rental to ensure an 8% rate of return. Woods's incremental borrowing rate is 9%, and the implicit rate of the lessor is unknown.

6. Collectibility of lease payments is reasonably predictable, and no important uncertainties surround the amount of costs yet to be incurred by the lessor.

(Both the lessor and the lessee's accounting period ends on December 31.)

Instructions

(Both the lessor and the lessee's accounting period ends on December 31.)

(b) Calculate the amount of the annual rental payment.

(c) Prepare all the necessary journal entries for Woods for 2011.

(d) Prepare all the necessary journal entries for Palmer for 2011.

### Previous Q& A

#### Assume you are planning to invest 5000 each year for six

assume you are planning to invest 5000 each year for six years and will earn 10 percent per year. determine the future

#### Explain the perfectly competitive firm which you have

examine a perfectly competitive firm that you have recently purchased a product from focusing specifically on how it

#### For this assignment for this problem imagine you are an

for this assignment for this problem imagine you are an accountant and come into work to find several urgent emails

#### The following data in thousands of dollars have been taken

the following data in thousands of dollars have been taken from the accounting records ofnbsplarden corporationnbspfor

#### Identify the fixed and variable costs at the fast food

you are the owner of a fast food restaurant. given a new item that you recently advertised you experience additional

#### What is the unit product cost for the month under variable

maffei company which has only one product has provided the following data concerning its most recent month of

#### What are three aspects of your lifestyle that are different

what are three aspects of your lifestyle that are different from your parentsrsquo lifestyle? what impact does this

#### What is consumer behavior what is the importance of

what is consumer behavior? what is the importance of consumer behavior within the framework of marketing? how have

#### Using at least two current examples explain effective

a successful supply chain strategy includes good design and implementation. however supply chain strategy is not

#### Select a purchase you have made recently and describe in

write a 700- to 1050-word paper in which you relate consumer behavior to marketing. in your paper address the

### Similar Q& A

#### Internal controls-payroll cycle

Please provide an explanation of the strengths and weaknesses of the internal controls related to the payroll cycle.

#### Relevant aspects of describing data

Discuss what you consider to be the relevant aspects of describing data. Explain and tell why.

#### Source of nonauthoritative guidance

Which of the following does the FASB consider a source of nonauthoritative guidance for use then there is no authoritative guidance available?

#### What it was designed to accomplish

Regarding the gift splitting provision of 2513, comment on the following.

#### Bob has 2000000 of shoes in stock that cost 12 per pair you

bob has 2000000 of shoes in stock that cost 12 per pair. you are also able to determine the following amountsnrv 11.25

#### Why accountant need to make a reversing entry

What are reversing entries? Why would an accountant need to make a reversing entry? What are the pros and cons of using reversing entries?

#### It is agreed that the allowance account should be 3000 and

dick acer and george dooley decide to form a partnership. acer invests 25000 cash and accounts receivable of 30000 less

#### Financial and operational plans-enrolment budgets

Let's say that you work in the budgeting office at a university and you have in front of you the expected student enrollment for the upcoming academic year. Discuss a few financial and operational plans that would be dictated by the enrolment bud..

#### What gain must father recognize in 2012

In 2011, Father sold land to Son for \$150,000 cash and an installment note for \$450,000 due in 2015. Father's basis was \$240,000. In 2012, after paying \$27,000 interest but nothing on the principal, Son sold the land for \$600,000 cash. As a result..

#### Journal entry for wood and engram

Wood Incorporated factored \$150,000 of accounts receivable with Engram Factors Inc. on a wotkout-recourse basis. Engram assesses a 2% finance charge of the amount of accounts receivable and retains an amount equal to 6% of accounts receivable for ..

#### Problem on realized gain of loss

Elizabeth's property had an adjusted basis of \$9000 and a fair market value of \$10,500, and Elizabeth gave Debbie \$4500 in cash. Determine Debbie's and Elizabeth's realized gain of loss, recognized gain or loss and the basis in their new property.

#### Focus on how auditing and ethics are related or how ethical

focus on how auditing and ethics are related or how ethical behavior helped impact auditors on their audit engagement.