User Account

All Pages

How much interest expense should be reported

Assignment Help Accounting Basics
Reference no: EM132972149

Question - Talion Inc. leases equipment to its customers under non-cancelable leases. On January 1, 2020, Talion leased equipment costing P4,000,000 to Shawn Co., for nine years. The rental cost was P440,000 payable in advance semiannually (January 1 and July 1), plus P20,000 semiannually for executory costs. The equipment had an estimated life of 15 years and sold for P5,330,250 with an estimated unguaranteed residual value of P800,000. The implicit interest rate is 12 percent.

Based on the foregoing and the result of your audit, compute for the following: (Round off present value factors to four decimal places.)

1. How much is the total interest income from lease that will be earned by Talion, Inc.?

a. P2,869,988

b. P3,389,748

c. P3,675,616

d. P 0

2. Talion, Inc. should report profit on the sale at

a. P1,330,252

b. P1,044,384

c. P1,050,012

d. P1,338,492

3. How much should be reported by Shawn Co. as liability under finance lease as of December 31, 2020?

a. P4,143,593

b. P4,446,613

c. P4,273,410

d. P 0

4. How much should be reported by Shawn Co. under current liabilities as liability under finance lease as of December 31, 2020?

a. P356,798

b. P378,207

c. P394,252

d. P 0

5. How much interest expense should be reported by Shawn Co. in relation to the lease for the year ended December 31, 2020?

a. P508,064

b. P501,793

c. P543,398

d. P0

Reference no: EM132972149

Questions Cloud

Calculate the price of the same bond : The face value is F = £100, the coupon rate is 8% p.a. and YTM (yield to maturity) is 11%. Calculate the price of the same bond
Find what amount claimed for cca on corporation tax return : Kookie uses straight-line depreciation for financial reporting purposes. What amount was claimed for CCA on the corporation's tax return for the year?
Prepare goldfinger closing entries for the current year : Assume shareholders owned 4,000 shares of Goldfinger's common stock during the year. Prepare Goldfinger's closing entries for the current year
What services does the alf provide : What services does the ALF provide and How do they keep current in the area of developmental disabilities?
How much interest expense should be reported : How much interest expense should be reported by Shawn Co. in relation to the lease for the year ended December 31, 2020
Find fama income tax payable for the current year would be : Find Fama income tax payable for the current year would be? Fama Corporation reported $200 million of pretax accounting and taxable income in the current year.
What melvin deferred tax balance should be : The 2020 income statement also included $ 150,000,These were Melvin's only reversible differences. At December 31, 2020, Melvin's deferred tax balance should be
How many more units of product a need to be sold : How many more units of Product A need to be sold to breakeven if Product A changes from 60% to 70% of total sales
Compute the call option price c-one : Compute the call option price C1. Consider a stock with 42% yearly volatility and a current price of 437.5, moreover, the annual risk-free rate is r=0.0125.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Units-of-production method of depreciation

What is the depreciation for 2007, if Baldwin Corporation uses the asset 9,100 hours and uses the units-of-production method of depreciation?

  Use the companys annual report to answer the following

The financial statements of Zetar plc are presented in Appendix C. The company's complete annual report, including the notes to its financial statements,

  What is the net present value for an investment in a piece

what is the net present value for an investment in a piece of equipment of 400000? use the present value factors from

  How do you think the given can be accomplished

After the knowledge you have gained regarding the use of the General Journal and the General Ledger, how do you think this can be accomplished?

  Determine whether the company should make the cases or buy

a company is planning to introduce a new portable tv to its existing product line. management must decide whether to

  Discuss requirements for the primary government

Assume a primary government as points a voting majority of the governing board of a legally separate organization. When determining the financial reporting.

  Prepare journal entries to record transactions from January

Pinky Pop Company sold a piece of land with a carrying amount of P6,000,000, Prepare journal entries to record transactions from January

  Te selling price of the companys product is 1800 per unit

complete the following three exercises and submit to your instructor. be sure to show your work for calculations to

  What was novembers income for each project

Project management allows profitability analysis by tracking revenue and expenses by project. What was November's income for each project?

  Can employing child labour ever be ethical

Analyse in accordance with utilitarian, deontological and relative ethical theories - Applying ethical theories

  The change in liabilities for the year

Q1. A company began the year with Assets of $100,000, Liabilities of $20,000 and Stockhoder's equity of $80,000. During the year Assets increaseds $55,000 and stockhoder's equity increased $20,000 What was the change in Liabilities for the year?

  If sales of pear corporation totaled 500000 for the

if sales of pear corporation totaled 500000 for the current year 50000 units at 10 each and planned sales were 405000

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: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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