User Account

All Pages

What will be the effect of the lease on cafe med earnings

Assignment Help Accounting Basics
Reference no: EM133555199

Question: At January 1, 2024, Café Med leased restaurant equipment from Crescent Corporation under a nine-year lease agreement. - The lease agreement specifies annual payments of $22,000 beginning January 1,2024 , the beginning of the lease, and on each December 31 thereafter through 2031. - The equipment was acquired recently by Crescent at a cost of $189,000 (its fair value) and was expected to have a useful life of 13 years with no salvage value at the end of its life. - Because the lease term is only 9 years, the asset does have an expected residual value at the end of the lease term of $117,029. - Crescent seeks a 10\% return on its lease investments. By this arrangement, the lease is deemed to be an operating lease. Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1 )

Required: 1. What will be the effect of the lease on Café Med's earnings for the first year (ignore taxes)? Note: Enter decreases with negative sign.

2. What will be the balances in the balance sheet accounts related to the lease at the end of the first year for Café Med (ignore taxes)? Note: For all requirements, round your intermediate calculations and final answers to the nearest whole dollars.

Reference no: EM133555199

Questions Cloud

What is difference in preventative and detective controls : What are internal controls? Which part of the fraud triangle can internal controls impact? How does an organization set a strong internal control system
What you feel are greatest influences on clinical judgment : What do you feel are the greatest influences on clinical judgment? Is it experience, knowledge, or a combination of those things?
Create evaluation methods for two out of the four initiative : Create evaluation methods for two out of the four initiatives of the quality improvement plan related to EMTALA.
What effect is zach notice on the llc : In year 2022, Zach gives notice of his intent to withdraw from the LLC. May Zach withdraw? Of what effect is Zach's notice on the LLC?
What will be the effect of the lease on cafe med earnings : What will be the effect of the lease on Café Med's earnings for the first year (ignore taxes)? Note: Enter decreases with negative sign.
How you contributed to the design : Describe and provide evidence for how you contributed to the code your team delivered. Include representative code snippets and explain how they work
How evaluation methods for healthcare quality initiatives : Discusses how evaluation methods for healthcare quality improvement initiatives should change over time, depending on the change of infection rates over time.
Explain why the group consolidated capital gain net income : Explain why the group's consolidated capital gain net income or net capital loss is not merely the sum of the members' separate capital gain net incomes
How did the tax cuts and jobs act affect businesses with : How did the Tax Cuts and Jobs Act affect businesses with average annual gross receipts of $25 million or less in terms of the Uniform Capitalization (UNICAP)

Reviews

Write a Review

Accounting Basics Questions & Answers

  Prepare income statement for abc corporation for september

ABC Corporation manufactures and sells laptop computers. Prepare the income statement for ABC Corporation for September under variable costing

  Determine the amounts to be recorded on the books of darby

darby sporting goods inc. has been experiencing growth in the demand for its products over the last several years. the

  How much is the money worth today

Kristen's grandmother promises to give her $3,000 at the end of three years and $4,000 at the end of four years. How much is the money worth today

  How much should epson record as depreciation expense

January 2, 2017, of P864,000 based on an appropriate rate of interest. For 2018, how much should Epson record as depreciation expense for the leased machine?

  What is Dan s assessable income in the current tax year

Dan received a cheque for the net amount of $3600. In relation to the payment, what is Dan s assessable income in the current tax year

  What is investment income to be reported by sm co for year

What is the investment income to be reported by SM Co. for the year ended December 31, 2011 regarding its investment in PLDT Co.?

  What is role and business implications of digital corporate

What is Role and business implications of digital corporate financial reporting (e.g., XBRL technology), and evidence of impact on key stakeholders

  Kaplan company inc uses a normal costing system and

kaplan company inc. uses a normal costing system and estimated its overhead costs for the current year to be as follows

  Costs incurred internally to create goodwill

Indicate whether the following items are capitalized or expensed in the current year.

  Determine what issues were addressed and disclosed

Has the company filed a 10-Q during the most recent time period? If so, open that document and determine what issues were addressed and disclosed.

  Compute the issue price of the bonds on january

On January 1, 2003, Buster Corporation issued 100 bonds with a par value of $ 1,000 each. Compute the issue price of the bonds on January 1, 2003

  Calculate the amount of the dividend paid

ABC Company began operations in January, 2017, by issuing 8,600 shares of 8%, Calculate the amount of the $85,000 dividend paid

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