User Account

All Pages

What should day record as a lease liability

Assignment Help Accounting Basics
Reference no: EM132122537

Question - On December 31, year 1, Day Co. leased a new machine from Parr with the following pertinent information:

Lease term 8 years

Annual rental payable at beginning of each year $60,000

Useful life of machine 10 years

Day's incremental borrowing rate 15%

Implicit interest rate in lease (known by Day) 12%

The lease is not renewable, and the machine reverts to Parr at the termination of the lease. The cost of the machine on Parr's accounting records is $425,000.

Required: At the beginning of the lease term, what should Day record as a lease liability?

Reference no: EM132122537

Questions Cloud

How determine the cost effectiveness of purchasing : How would the firm determine the cost effectiveness of purchasing the long term assets used by the firm over an extended period of time
Innovate in medical technologies dedicated to cure cancer : [Company name] was started by cofounders ( names ) to innovate in medical technologies dedicated to cure cancer.
What is the amount of the five annual deposits : To repay this Bob wants to start making five equal annual deposits into fund that earns 6% annum on January 1, 2020. What is the amount of five annual deposits
Implementation of the e-supply chain and logistics : Project will be based on the implementation of the e-supply chain and logistics in real world.
What should day record as a lease liability : The lease is not renewable, and the machine reverts to Parr at the termination of the lease. At beginning of lease term, what should Day record as lease
Efficiency of a business process : Explain how a computer-based information systems can improve the efficiency of a business process.
Determine the amount to be reported as the cost of the land : An old warehouse on the property was demolished at a cost of $8,200; Determine the amount to be reported as the cost of the land
Benefits-challenges of growing through internal expansion : What are the benefits and challenges of growing through internal expansion?
What is the cash balance per books at april : Outstanding checks at April 30, year 2, totaled $7,000. There were no deposits in transit at April 30, year 2. What is the cash balance per books at April 30

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd