On july 1 2008 falk company signed a contract to lease

Reference no: EM13589598

On July 1, 2008, Falk Company signed a contract to lease space in a building for 20 years. The lease contract calls for annual (prepaid) rental payments of $90,000 on each July 1 throughout the life of the lease and for the lessee to pay for all additions and improvements to the leased property. On June 25, 2013, Falk decides to sublease the space to Ryan & Associates for the remaining 15 years of the lease-Ryan pays $240,000 to Falk for the right to sublease and it agrees to assume the obligation to pay the $90,000 annual rent to the building owner beginning July 1, 2013. After taking possession of the leased space, Ryan pays for improving the office portion of the leased space at a $140,000 cost. The improvements are paid for by Ryan on July 5, 2013, and are estimated to have a useful life equal to the 21 years remaining in the life of the building

Prepare Ryan's year-end adjusting entries required at December 31, 2013

a. To amortize the $240,000 cost of the sublease

i. Record the year-end adjusting entry for the amortization expense of the leasehold.

b. To amortize the office improvements

i. Record the year-end adjusting entry for the amortization expense of the leasehold improvements

c. To record rent expense

i. Record the year-end adjusting entry for the rent expense.

Reference no: EM13589598

Questions Cloud

The solubility of silver sulfate ag2so4 at a pressure of 37 : question the solubility of silver sulfate ag2so4 at a pressure of 37 atmospheres and 37 degrees has been measured at

Is this r value significant provide a rationale for your : what is the r value for the relationship between hamstring strength index 60degs and the shuttle run test? is this r

What is the r value for the relationship between hamstring : 1. what is the r value for the relationship between hamstring strength index 60degs and the shuttle run test? is this r

Sunset press has just purchased a new trimming machine that : 1.sunset press has just purchased a new trimming machine that cost 47677. the machine is expected to save 7000 per year

On july 1 2008 falk company signed a contract to lease : on july 1 2008 falk company signed a contract to lease space in a building for 20 years. the lease contract calls for

From the information given prepare a statement of cash : you have completed the field work in connection with your audit of alexander corporation for the year ended december 31

Upper darby park department is considering a new capital : upper darby park department is considering a new capital investment. the following information is available on the

Cape cod seafood company purchases lobsters and processes : cape cod seafood company purchases lobsters and processes them into tails and flakes. it sells the lobster tails for 21

Manning co manufactures and sells trophies for winners of : manning co. manufactures and sells trophies for winners of athletic and other events. its manufacturing plant has the

User Account

All Pages