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Extractor Company leased a machine on July 1, 2013, under a 10-year lease. The economic life of the machine is estimated to be 15 years. Title to the machine passes to the Extractor Company at the expiration of the lease, and thus, the lease is a capital lease. The lease payments total $194,000 per year (which includes executory costs of $6,000 per year), all payable in advance annually. The incremental borrowing rate of the company is 9%, and the lessor's implicit interest rate is unknown. Extractor Company uses the straight-line method of amortization and the calendar year for reporting purposes.
1. Give all entries on the books of the lessee relating to the lease for 2013.
2. Assume that the lessor retains title to the machine at the expiration of the lease, that there is no bargain renewal or purchase option, and that the fair value of the equipment is $1,420,000 as of the lease date. Using the criteria for distinguishing between operating and capital leases according to FASB ASC Topic 840, what would be the amortization expense for 2013?
In 2010, Richard, a single taxpayer, has adjusted gross income of 40,450. His AGI includes $4000 of qualified dividends. Richard has no dependents and does not itemize deductions. What is his 2010 federal income tax?
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When both borrowed an owned funds are mingled int he same account for purposes of categorizing interest expense a repayment of the debt is allocated first to?
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When one media company buys another, goodwill is often the most costly asset acquired. World media paid $700,000 to acquire-Journalize World Media's acquisition of The Dandy Dime.
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Assume a healthcare company sold bonds that have a ten-year maturity, a 12% coupon rate with annual payments, and a $1,000 par value.
As part of its cost accounting routine, Wilcox Company assigns $36,000 in fixed costs to each product each month. Calculate the break-even dollar sales volume for each project.
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