Prepare a partial amortization table

Reference no: EM132088298

Question: XYZ Company as the lessee records a capital lease of equipment on January 1, 2015. The five annual lease payments of $58,000 are made at the beginning of each year. The present value of the lease payments at 8% is $250,000. XYZ uses the straight line method for depreciation (no residual value).There is no transfer of ownership and there is no bargain purchase option. The equipment will have a life of 10 years.

Instructions: (a) Prepare a partial amortization table for 2015 (provided for you) and 2016. Compute the necessary blanks (not all will be used) in the table below that allow you to arrive at the lease obligation balance at 1/1/2016.

(b) Prepare all of XYZ's journal entries for 2015 and the entry for the lease payment for 2016.

Reference no: EM132088298

Questions Cloud

Commercial would have done better in another quarter : Do you think this commercial would have done better in another quarter, or at a different time during the game?

Is it possible to have a negative cash cycle : is it possible to have a negative cash cycle (receive your funds before encumbering them?)

Interest rate cannot fall below : The interest rate cannot fall below the net rate from storage, is a true or false. Please can someone explain?

Values and beliefs between manager and employee : How does a manager reach out to employees when there are critical differences in values and beliefs between manager and employee?

Prepare a partial amortization table : XYZ Company as the lessee records a capital lease of equipment on January 1, 2015. The five annual lease payments of $58,000 are made at the beginning.

What is the effective financing rate for a us : Based on this information, what is the effective financing rate for a U.S. firm that takes out a one-year, uncovered NZ$ loan?

Explain what you can do to develop these skills : Analyze your ability to incorporate these strategies into a consulting project. Identify the skills you are lacking to use these strategies.

Complete the goals of the company that have the most value : Prioritize what has to be done in order of importance. Complete the goals of the company that have the most value.

What are neil and callie bases in the partnership interest : This year, Callie and Neil formed the equally owned CN partnership. Callie contributed $300,000 of cash and Neil contributed real estate valued at $450,000.

User Account

All Pages