Assume that on january 1 2014 yard waste corp signs a

Reference no: EM13483108

Assume that on January 1, 2014, Yard Waste Corp. signs a 5-year noncancelable lease agreement to lease an industrial-strength mulching machine. The following information pertains to this lease agreement.

1. The agreement requires equal rental payments of $96,680 beginning on December 31, 2014.

2. The fair value of the machine on January 1, 2014, is $400,000.

3. The machine has an estimated economic life of 10 years, with an unguaranteed residual value of $35,000. The lease contains a bargain purchase price of $2,000.Yard Waste depreciates similar machines on the straight-line method.

4. The lease is nonrenewable. At the termination of the lease, the machine reverts to the lessor.

5. Yard Waste's incremental borrowing rate is 8% per year. The lessor's implicit rate is not known by Yard Waste.

6. The yearly rental payment includes $1,563.19 of executory costs related to insurance on the machine.

Reference no: EM13483108

Questions Cloud

Determine the amount of write-down reversal required using : at december 31 2012 mnc still has the same three products in its inventory. updated information for each product

Variable costs are expected to stay at 50 of saleswhile : phelps canning company is considering an expansion its current income staement is sales 5000000variable expenses50 of

Assuming the cost of direct materials used is 1500000 : assuming the cost of direct materials used is 1500000 compute the total manufacturing costs using the information

One of mr bajaj his wife their son and mr bajajs mother is : one of mr. bajaj his wife their son and mr. bajajs mother is an engineer and another is a doctor.if the doctor is a

Assume that on january 1 2014 yard waste corp signs a : assume that on january 1 2014 yard waste corp. signs a 5-year noncancelable lease agreement to lease an

There are 3 ants at 3 corners of a triangle they randomly : there are 3 ants at 3 corners of a triangle they randomly start moving towards another corner. what is the probability

Optic matrix inc manufactures and assembles automobile : optic matrix inc. manufactures and assembles automobile instrument panels for both yokohama motors and detroit motors.

Hagar co computed an overhead rate for machining costs : hagar co. computed an overhead rate for machining costs 1500000 of 15 per machine hour. machining costs are driven by

The stock is selling on the market for 9700 and trivoli : trivoli industries plans to issue some 100 par preferred stock with an 11 percent dividend. the stock is selling on

User Account

All Pages