Reference no: EM13944718
On January 1, 2004, Haden Company (as lessor) entered into a noccancelable lease agreement with Sandy Corporation for machinery which was carried on the accounting records of Haden at $4,530,000 and had a market value of $4,800,000. Minimum lease payments under the lease agreement which expires on December 31, 2013, total $7,100,000. PAYMENTS of $710,000 are due each January 1. The first payment was made on January 1, 2004 when the lease agreement was finalized. The interest rate of 10% which was stipulated in this lease agreement is the implicit rate set by the lessor. The effective interest method of amortization is being used. Sandy expects the machines to have a ten year life with no salvage value, and be depreciated on a straight-line basis. Collectability of the rentals is reasonably predictable, and there are no important uncertainties surrounding the costs yet to be incurred by the lessor.
a. From the lessee's viewpoint, what kind of lease is the above agreement? From the lessor's viewpoint, what kind of lease is this agreement?
b. What should be the income before income taxes derived by Haden from the lease for the year ended December 31, 2004?
c. Ignoring income taxes, what should be the expenses incurred by Sand from the lease for the year ended December 31, 2004?
d. What journal entries should be recorded by Sandy Company for all of 2004?
e. What journal entries should be recorded by Haden Company for all of 2004?
|
Describe your identified situation
: Speak about relationship infidelity and explain how an individual has consciously made a decision to engage in a behavior that violated their cognition's-values, beliefs, attitudes, and morals. Describe your identified situation.
|
|
Why is memory management an important aspect of an os
: Why is memory management an important aspect of an Operating system?
|
|
Identify a social issue within an educational context
: Identify a social issue within an educational context, the motivational-change that needs to occur related to this issue, and the population affected by the issue. Also consider the motivational theory(ies) you would apply to this issue to effect ..
|
|
Comparing the appraised value and recent selling price
: A real estate agent has collected a random sample of 75 houses that were recently sold in a suburban community. She is particularly interested in comparing the appraised value and recent selling price of the houses in this particular market. The v..
|
|
What journal entries should be recorded by sandy company
: What journal entries should be recorded by Sandy Company for all of 2004? What journal entries should be recorded by Haden Company for all of 2004?
|
|
Development of a qualtrics survey
: This research project involves the development of a Qualtrics survey which you need to design and include whether you choose to develop a qualitative, quantitative, or mixed method of survey and/or interview questions.
|
|
Major problems identified by the author
: What are the major problems identified by the author? Is he persuasive in demonstrating that his concerns are substantial? Why or why not?
|
|
Carries a uniform surface charge density
: Open-Response Homework Problem 1.1 Since 1982, a penny has contained 2.5grams of copper. The atomic weight of copper is 63.546g/mole and the atomic number is 29. How many electrons are in a penny? Open-Response Homework Problem 1.2 A solid, insula..
|
|
Score standard deviation of pain score
: Age 65+ Years Sample Size Mean Pain Score Standard Deviation of Pain Score New Medication 20 40.33 2.16 Standard Medication 35 59.80 2.49 Total: Age 65+ 55 52.72 9.74 1. Is there a statistically significant difference in mean pain scores between p..
|