Refer to the following lease amortization schedule. The 10 payments are made annually starting with the beginning of the lease. Title does not transfer to the lessee and there is no purchase option or guaranteed residual value. The asset has an expected economic life of 12 years. The lease is noncancelable. Payment 1 2 234 3 5 6 7 8 9 10 Cash Payment $ 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 $ 12,000 Multiple Choice O $8,111 O $12,000 Effective Decrease in Outstanding Interest balance Balance $6,911 $0 6,911 6,402 5,842 5,226 4,549 3,804 $ 2,984 ? ? $ 12,000 5,089 5,598 6,158 6,774 7,451 8,196 $ 9,016 What amount would the lessee record as annual amortization on the right-of- use asset using the straight-line method? Note: Round your answer to the nearest whole dollar. ? ? $ 81,108 69,108 64,019 58,421 52,263 45,489 38,038 29,842 $ 20,826 ? ?
Refer to the following lease amortization schedule. The 10 payments are made annually starting with the beginning of the lease. Title does not transfer to the lessee and there is no purchase option or guaranteed residual value. The asset has an expected economic life of 12 years. The lease is noncancelable. Payment 1 2 234 3 5 6 7 8 9 10 Cash Payment $ 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 $ 12,000 Multiple Choice O $8,111 O $12,000 Effective Decrease in Outstanding Interest balance Balance $6,911 $0 6,911 6,402 5,842 5,226 4,549 3,804 $ 2,984 ? ? $ 12,000 5,089 5,598 6,158 6,774 7,451 8,196 $ 9,016 What amount would the lessee record as annual amortization on the right-of- use asset using the straight-line method? Note: Round your answer to the nearest whole dollar. ? ? $ 81,108 69,108 64,019 58,421 52,263 45,489 38,038 29,842 $ 20,826 ? ?
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 9RE: Use the information in RE20-3. Prepare the journal entries that Richie Company (the lessor) would...
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