Reference no: EM132631230

Questions -

Q1. On August 1, 2018, Bazinga Company entered into a capital lease, and correctly recorded the leased asset, and related obligation at $100,000. The annual interest rate implicit in the lease was 9%, and the first lease payment of $1,600 is due at the end of each month of the lease. Use this information to make a general journal entry for the august 31, 2018 montly lease payment.

Q2. On January 2,2019, Alpha issued 18,000 shares of $10 par value common stock for $13 per share. On April 1, 2019, Alpha reacquired 1,500 of these shares when they were trading $16 per share. On August 1, 2019 Alpha reissued 800 shares of treasury stock at the going market rate of $19 per share. Use this information to prepare the General Journal entry for August 1 transaction.

Q3. On January 2, 2018, Crown Company purchased 14,000 shares of the stock of Lyle Company, and did not obtain significant influence. The investment is intended as a long term investment. The stock was purchased for $12 per share, and represents a 10% ownership stake. Lyle company made $55,000 of net income in 2018, and paid dividends of 50 cents per share on December 15, 2018. On December 31, 2018 Lyle Companys stock was trading on the open market for $15 per share at the end of the year. Use this information to prepare the general journal entries for January 2 purchase and the December 15 & 31, 2019 record of income & gain/loss.