User Account

All Pages

Prepare the lease schedule for the lessee

Assignment Help Accounting Basics
Reference no: EM132628381

On 1 July 2017, Tedd Ltd leased a large truck from Todd Ltd. The truck had a fair value of $54,000 on 1 July 2017. The lease agreement contained the following provisions:

  1. Lease term 3 years
  2. Annual lease payment in arrears on 30 June each year $20,000.
  3. Expected residual value at the end of the lease term $10,000.
  4. There is $10,000 residual value guaranteed by Tedd Ltd.
  5. Interest rate implicit in lease 10%.
  6. The lease is non-cancellable.
  7. The expected economic life of the machine is 5 years.
  8. Tedd Ltd intends to return the truck at the end of the lease term.
  9. Both companies apply AASB 16 "Leases" for the accounting treatment of lease transactions.

Required

Question 1: Calculate the present value of lease payments (show all workings).

Question 2: Prepare the lease schedule for the lessee.

Question 3: Prepare the journal entries for the lessee on 1 July 2017.

Question 4: Prepare the journal entries for the lessee on 30 June 2018.

Reference no: EM132628381

Questions Cloud

What amount of interest expense should be reported : At the beginning of 2016, Wallace Corporation, Using the effective-interest method of amortization, what amount of interest expense should be reported for 2016?
Theories of strategy development and implementation : Select any case from the following aspects of competitive strategy and apply the theories of strategy development and implementation as relevant
Question - Prepare a balance sheet : Question - Prepare a balance sheet. Wolfpack Construction has the following account balances at the end of the year
Constraint in project management : The triple constraint in Project Management is known to be time, cost and scope. The ability to manage these three items very often leads to project success.
Prepare the lease schedule for the lessee : Prepare the lease schedule for the lessee. Prepare the journal entries for the lessee on 1 July 2017. Prepare the journal entries for the lessee on 30 June 2018
What is socrates really on trial : What is Socrates really on trial? Granted, there are charges. But do the charges really explain anything?
Which of the three basic schools of philosophy : Give a personal example of where you've seen or experienced each of the basic schools of thoughts for Philosophy.
Record these investments and withdrawals by the partners : The following transactions are from the records of Campo-Stewan Co. Record these investments and withdrawals by the partners in a General Journal
What should be nursing role in decision making : What is and/or should be nursing's role in decision making regarding selecting information systems? Your initial post should be at least 500 words.

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.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  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!

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