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Student Name:
Class:
365,760$
348,685$
Debit Credit
365,760
Amount to be recovered (fair value)
General Journal
Requirement 3: Journal entries on December 31, 2016
McGraw-Hill/Irwin
Instructor
Requirement 1: Lessor's Calculation of Lease Payments
Requirement 2: Present Value of Minimum Lease Payments
Annual Lease Payments
Present value of periodic Lease payments
RHONE-METRO INDUSTRIES
Problem 15-08
Western Soya Co. (Lessee)
Account
Leased equipment
Student Name:
Class:
McGraw-Hill/Irwin
Instructor
Problem 15-08
Effective
Dec. Interest Decrease Outstanding
31 Payments 10% in Balance Balance
2016 365,760
Debit Credit
26,576
Debit Credit
85,190
General Journal
Lease Amortization Schedule
General Journal
Requirement 4:
Requirement 5: Journal entries on December 31, 2017
Interest expense
Western Soya Co. (Lessee)
Account
Requirement 6: Journal entries on December 31, 2020
Western Soya Co. (Lessee)
Depreciation expense
Account
4 years
Given Data P15-08:
RHONE-METRO INDUSTRIES
Lease term
Student Name:
Class:
Requirement 1: Lessor's Calculation of Rental Payments
365,760$
Requirement 2: Present Value of Minimum Lease Payments
(a) By Western Soya Co. (the lessee)
Debit Credit
Requirement 3: Journal entries on December 31, 2016
General Journal
Problem 15-09
McGraw-Hill/Irwin
Instructor
Amount to be recovered (fair value)
Annual Rental Payments
RHONE-METRO INDUSTRIES
Western Soya Co. (Lessee)
Account
Requirement 4:
Effective
Dec. Interest Decrease Outstanding
31 Payments 10% in Balance Balance
2016 348,685
2016 100,000 100,000 248,685
Effective
Dec. Interest Decrease Outstanding
31 Payments 10% in Balance Balance
2016 365,760
2016 100,000 100,000 265,760
2017 100,000 26,576 73,424 192,336
Debit Credit
87,171
87,171 «- Correct!
General Journal
Requirement 5: Journal entries on December 31, 2017
Lease Amortization Schedule
Lessor Amortization Schedule
Depreciation expense
Accumulated depreciation
Western Soya Co. (Lessee)
Account
Debit Credit
4,000
4,000 «- Correct!
Requirement 6: Journal entries on December 31, 2020
Operating expense
Prepaid operating expense
Western Soya Co. (Lessee)
Account
General Journal
4 years
300,000$
Given Data P15-09:
RHONE-METRO INDUSTRIES
Lease length
Equipment cost
Student Name:
Class:
21,691$
Correct!
Debit Credit
26,427
26,427 «- Correct!
Instructor
Requirement 1:
Dealer's Profit
MID-SOUTH AUTO LEASING
General Journal
Present value of quarterly lease payments
Leased equipment
Requirement 2 Journal entries on September 30, 2016
Problem 15-15
McGraw-Hill/Irwin
Account
Anything Grows (Lessee)
Lease payable
Student Name:
Class:
Instructor
Problem 15-15
McGraw-Hill/Irwin
Effective
Interest Decrease Outstanding
Date Payments 3% in Balance Balance
9/30/2016 26,427
9/30/2016 3,000 3,000 23,427
Correct! Correct! Correct!
Debit Credit
1,652
1,652 «- Correct!
Lease Amortization Schedule
General Journal
Requirement 3:
Requirement 4: Journal entries on December 31, 2016
Account
Anything Grows (Lessee)
Depreciation expense
Accumulated depreciation
Student Name:
Class:
Instructor
Problem 15-15
McGraw-Hill/Irwin
Debit Credit
General Journal
Account
Requirement 5: Journal entries on September 29, 2018
3,000$
3 years
Given Data P15-15:
MID-SOUTH AUTO LEASING
Quarterly payments
Lease term
Student Name:
Class:
Debit Credit
McGraw-Hill/Irwin
Instructor
General Journal
1(a) By Bidwell Leasing (the lessor)
Requirement 1:
Problem 15-18
Requirement 2: Journal entries on December 31, 2016
Since at least one (two in this case) classification criterion and both additional
lessor conditions are met, this is a capital lease to the lessor (Bidwell
1(b) By Red Baron Flying Club (the lessee)
Account
Red Baron Flying Club (Lessee)
Student Name:
Class:
McGraw-Hill/Irwin
Instructor
Problem 15-18
Effective
Interest Decrease Outstanding
Date Payments 10% in Balance Balance
645,526
1/1/16 110,000 110,000 535,526
645,526$
Effective
Interest Decrease Outstanding
Date Payments 9% in Balance Balance
663,625
1/1/16 110,000 110,000 553,625
Lease Amortization Schedule
RED BARON FLYING CLUB
Lease Amortization Schedule
BIDWELL LEASING
Requirement 3:
Requirement 4: Effective interest rate for Bidwell Leasing
Amount to be recovered (fair market value)
Requirement 5:
Student Name:
Class:
McGraw-Hill/Irwin
Instructor
Problem 15-18
Debit Credit
53,553
56,447
Debit Credit
10,000
100,000
General Journal
General Journal
Requirement 7: Journal entries on December 31, 2019
Requirement 6: Journal entries on December 31, 2016
Interest expense
Lease payable
Interest expense
Lease payable
Account
Red Baron Flying Club (Lessee)
Account
Red Baron Flying Club (Lessee)
Purchase at fair value 645,526$
Given Data P15-18:
BIDWELL LEASING
