Discuss the total obligation under capital leases

Assignment Help Accounting Basics
Reference no: EM131761098

On December 31, 2017, Smith Corporation leased an airplane from Thomas Company for an eight-year period expiring December 30, 2025. Equal annual payments of $400,000 are due on December 31 of each year, beginning with December 31, 2017. The lease is properly classified as a capital lease on Smith 's books. The present value at December 31, 2017 of the eight lease payments over the lease term discounted at 10% is $2,347,370. Assuming all payments are made on time, the amount that should be reported by Smith Corporation as the total obligation under capital leases on its December 31, 2018 balance sheet is ....?

What is the total obligation at 12/31/18? How did you arrive at your amount? Please share you calculations and any questions that you have here.

Reference no: EM131761098

Questions Cloud

Information about a particular industry : Equilibrium in a competitive industry. Suppose you are given the following information about a particular industry:
Find the amount financed and finance charge for the freezer : Find the amount financed, installment price, and finance charge for the freezer.
Drawbacks of the fiscal and monetary policies : What are the different instruments of fiscal and monetary policies which are available for supervising the banks and its defaults
Define all-inclusive definition of gross income : If an income item is within the all-inclusive definition of gross income, the item can be excluded only if the taxpayer can locate specific authority.
Discuss the total obligation under capital leases : the amount that should be reported by Smith Corporation as the total obligation under capital leases
Find the marginal products of labor and capital : Cost Minimization The production function for a product is given by q = K1/2L1/4 where K is capital, L is labor and q is output.
In applying most formulas involving rate and fractional : In applying most formulas involving a rate, a fractional or decimal equivalent of the rate is used.
What is the purpose of the audit teams brainstorming session : what is the auditors responsibility under auditing standards for detecting fraud
Distinguish between dependent and independent demand : Distinguish between dependent and independent demand in: a McDonald's restaurant,a pharmaceutical supply house .

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.

  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!

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