Solution-What is the main cause of that difference

What is the main cause of that difference

Assignment Help Accounting Basics

Reference no: EM133159487

Question - On January 1, 2020, a machine was purchased for $400,000 by Younger Leasing Co. The machine is expected to have a 10-year life with no salvage value. Similar machines are depreciated on a straight-line basis by Younger. The machine was leased to Juniper Inc. for 3 years on January 1, 2020, with annual rent payments of $69,560 due at the beginning of each year, starting January 1, 2020. The machine is expected to have a residual value at the end of the lease term of $260,000, though this amount is unguaranteed.

Assume an incremental borrowing rate of 8% and an implicit rate of 6%. The present value of a $1 for 3 periods at 6% is 0.83962 and at 8% is 0.79383. The present value of an annuity due for 3 periods at 6% is 2.83339 and at 8% is 2.78326.

Required - For the fiscal year 2020, is there a difference in the expense reported by Juniper if it follows US GAAP versus IFRS? If there is a difference, what is the main cause of that difference?

Reference no: EM133159487

Questions Cloud

Select 3 laws that guide the hr team : Select 3 laws that guide the HR team and insert the following.

Discuss the nature of obstacles : 1. Discuss the nature of obstacles you will encounter in implementing this new structure. Which do you think will be the most important obstacles to overcome?

What will the cost of equity be : The firm is considering converting to a debt-equity ratio of 0.40. The pretax cost of debt is 7.5%. Ignoring taxes, what will the cost of equity be

Participate in the selection process : One of the most important skills a manager or human resources specialist can develop is the ability to actively participate in the selection process.

What is the main cause of that difference : For the fiscal year 2020, is there a difference in the expense reported by Juniper if it follows US GAAP versus IFRS

Strategy and execution of supply chain negotiations : Q1 what role do you think that the parties' identities as insiders (BizCo employees) versus outsiders (DMB employees) played in this case?

Illustrate the product flow in the supply chain : A global supply chain involves various departments within a firm and external partners to manage the end-to-end processes relating to selling the firm's product

Calculate the fixed selling and administrative expenses : For its fiscal year ended October 31, 2022, Wildhorse's break-even point was $1.37 million. Calculate the fixed selling and administrative expenses

Performance management role-play : Performance Management role-play - Manager's brief - Sarah People describe you as driven; a fair description given that you work incredibly hard. Success is imp

User Account

All Pages

What is the main cause of that difference

Reference no: EM133159487

Reference no: EM133159487

Questions Cloud

Reviews

Write a Review

Accounting Basics Questions & Answers

How much control does fed have over this longer real rate

Coures:- fundamental accounting principles

Accounting problems

Theory of interest - term structure of interest rates

Write a report on internal controls

Prepare the bank reconciliation for company

Cost-benefit analysis

Theory of interest

Liquidity and profitability

What is the expected risk premium on the portfolio

Simple interest and compound interest

Capm and venture capital

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT