Rand medical manufactures lithotripters lithotripsy uses

Assignment Help Accounting Basics

Reference no: EM13482537

Rand Medical manufactures lithotripters. Lithotripsy uses shock waves instead of surgery to eliminate kidney stones. Physicians' Leasing purchased a lithotripter from Rand for $2,630,000 and leased it to Mid-South Urologists Group, Inc., on January 1, 2013.

Lease Description:
Quarterly lease payments	$	171,628	- beginning of each period
Lease term		5	years (20 quarters)
No residual value; no BPO
Economic life of lithotripter		5	years
Implicit interest rate and lessee's incremental borrowing rate		12	%
Fair value of asset	$	2,630,000

Collectibility of the lease payments is reasonably assured, and there are no lessor costs yet to be incurred.

Required:

How should this lease be classified by Mid-South Urologists Group and by Physicians' Leasing?

2.	Prepare appropriate entries for both Mid-South Urologists Group and Physicians' Leasing from the inception of the lease through the second rental payment on April 1, 2013. Depreciation is recorded at the end of each fiscal year .

Mid-South Urologists Group (Lessee):

Physicians' Leasing (Lessor):

3.	Assume Mid-South Urologists Group leased the lithotripter directly from the manufacturer, Rand Medical, which produced the machine at a cost of $2.2 million. Prepare appropriate entries for Rand Medical from the inception of the lease through the second lease payment on April 1, 2013.

Reference no: EM13482537

Questions Cloud

Detmer holdings ag of zurich switzerland has just : detmer holdings ag of zurich switzerland has just introduced a new fashion watch for which the company is trying to

Incur 429000 of costs for 36-month zip contract paying 70 : 1. pay 238000 to lessor co. as 1st annual payment on the signing of a 3-year noncancelable computer lease to begin 111.

On the basis of the cash forecast write a brief report : a company is negotiating with the bank for a 200000 90 day12 loan effective july 1 of the current year. if the

On august 31 kravsnik company receives its bank statement : on august 31 kravsnik company receives its bank statement. the company deposits its receipts in the bank and makes all

Rand medical manufactures lithotripters lithotripsy uses : rand medical manufactures lithotripters. lithotripsy uses shock waves instead of surgery to eliminate kidney stones.

How can sales clerks employed at rare earth clothing use : rare earth clothing is a retail store specializing in womensclothing. the store has established a liberal return policy

On the basis of the following data for nader co for 2008 : on the basis of the following data for nader co. for 2008 and the preceding year ended december 31 2008 prepare a

Prepare the adjusting entries at march 31 assuming that : the ledger of piper rental agency on march 31 of the current year includes the following selected accounts before

The payments are 20500 the first year and increase by 800 : on january 1 2013 sweetwater furniture company leased office space under a 21-year operating lease agreement. the

User Account

All Pages