ch21 - CHAPTER 21 ACCOUNTING FOR LEASES MULTIPLE CHOICE...

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Unformatted text preview: CHAPTER 21 ACCOUNTING FOR LEASES MULTIPLE CHOICE —Conceptual Answer No. Description d 1. Advantages of leasing. d 2. Advantages of leasing. b 3. Basic principle of lease accounting. c 4. Conceptual support for treating all leases as a sale/purchase. a 5. Lease accounting by lessee. c 6. Knowledge of the capitalization criteria. d 7. Components of minimum lease payments. d 8. Identification of executory costs. c 9. Discount rate used by lessee. a 10. Depreciation of a leased asset by lessee. b 11. Effect of a capital lease on lessee's debt. a 12. Identification of lease type for lessor. d 13. Elements of lease receivable by lessor. a 14. Recognition of unearned lease income. c 15. Accounting for a sales-type lease. d 16. Accounting for initial direct costs. c 17. Disclosing obligations under capital leases. d *18. Gain/loss recognition in a sale-leaseback. MULTIPLE CHOICE —Computational Answer No. Description b 19. Operating lease expense for year. a 20. Operating lease expense for year. c 21. Calculate interest expense and depreciation expense for lessee. c 22. Calculate minimum annual lease payment. d 23. Calculate total annual lease payment. a 24. Identification of lease type for lessor. c 25. Identification of lease type for lessee. c 26. Calculate depreciation expense for lessee. d 27. Identification of lease type for lessee. b 28. Calculate profit and interest income for lessor/sales-type lease. a 29. Calculate interest expense and depreciation expense for lessee. c 30. Calculate profit on sales-type lease and interest income. a 31. Calculate income from operating lease. d 32. Calculate expense of an operating lease. b 33. Identification of lease type for lessee. a 34. Identification of lease type for lessor. d 35. Calculate lease receivable. 21- 2 Test Bank for Intermediate Accounting, Eleventh Edition MULTIPLE CHOICE—Computational (cont.) Answer No. Description b 36. Expense recorded by lessee/operating lease. d 37. Revenues and expenses recorded by lessor/operating lease. c 38. Calculate reduction of lease obligation for lessee. c 39. Identification of lease type for lessor. b 40. Determine discount rate implicit in lease payments. d 41. Lease-related expenses recognized by lessee. d 42. Determine long-term lease obligation for lessee. b *43. Gain recognized by lessee in a sale-leaseback. b *44. Sale-leaseback/operating lease. MULTIPLE CHOICE —CPA Adapted Answer No. Description c 45. Identification of lease type for lessee. a 46. Calculate the lease liability of a lessee. d 47. Calculate the lease liability of a lessee. a 48. Determine reduction of lease obligation for lessee. d 49. Calculate interest expense for lessee. d 50. Calculate depreciation expense for lessee....
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This note was uploaded on 05/01/2011 for the course ACCT 3341 taught by Professor Dr.ramaswamy during the Spring '09 term at University of St. Thomas-Texas.

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ch21 - CHAPTER 21 ACCOUNTING FOR LEASES MULTIPLE CHOICE...

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