Business, 10.04.2020 18:51 treyceratops1082

Castle leasing Company signs a lease agreement on January 1, 2017, to lease electronic equipment to Jan Way Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement.

1.Jan Way has the option to purchase the equipment for $16,000 upon termination of the lease. It is not reasonably certain that Jan Way will exercise this option.
2.Accounting for Leases The equipment has a cost of $120,000 and fair value of $160,000 to Castle Leasing. The useful economic life is 2 years, with a residual value of $16,000.
3.Castle Leasing desires to earn a return of 5% on its investment.
4.Collectibility of the payments by Castle leasing is probable.

(a) Prepare the journal entries on the books of Castle leasing to reflect the payments received under the lease and to recognize income for the years 2017 and 2018.
(b) Assuming that Jan Way exercises its option to purchase the equipment on December 31, 2018, prepare the journal entry to record the sale on Castle Leasing's books.

Answers: 1

Show answers

Other questions on the subject: Business

Business, 21.06.2019 16:30, yasminothman02

Which type of data does your company collect from customers or potential customers? a. positioning datab. market share datac. primary datad. secondary data select the best answer from the choices provided

Answers: 1

continue

Business, 22.06.2019 15:00, menendezliliana5

(a) what do you think will happen if the price of non-gm crops continues to rise? why? (b) what will happen if the price of non-gm food drops? why?

Answers: 2

continue

Business, 22.06.2019 17:30, gena75

Betty contracted with scooby’s skate store to deliver a pair of skates to jake for his birthday. scooby’s owner was going on a trip and delegated the delivery of the skates to brian. brian failed to make delivery. can jake sue brian for breach of contract, as he was not a party to the original contract? explain your answer. brian was not a party to the original contract. why would a court hold him responsible for failing to make delivery? if you do not think a court would hold him responsible, explain your answer. can jake sue scooby’s skates for breach of contract? explain your answer.

Answers: 2

continue

Business, 22.06.2019 19:00, mazolethrin3461

The following are budgeted data: january february march sales in units 16,200 22,400 19,200 production in units 19,200 20,200 18,700 one pound of material is required for each finished unit. the inventory of materials at the end of each month should equal 20% of the following month's production needs. purchases of raw materials for february would be budgeted to be:

Answers: 3

continue

You know the right answer?

Castle leasing Company signs a lease agreement on January 1, 2017, to lease electronic equipment to...