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4 3 3 4 0 rounding records each rental receipt as

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$       4 3 ,3 4 0 $    0 * * rounding * *
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Chapter 15-22 Records each rental receipt as rental expense.  Does not depreciate the asset. Any prepaid or noneconomic payment patters are straight-lined. Leasehold improvements are depreciated over the lesser of useful life  or lease term.   Operating Method (Lessee) Accounting by the Lessee Accounting by the Lessee Accounting by the Lessee Accounting by the Lessee
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Chapter 15-23 1. Interest Revenue. 2. Tax Incentives. 3. High Residual Value. Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Benefits to the Lessor
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Chapter 15-24 A lessor determines the amount of the rental, based on the rate of return  needed to justify leasing the asset. If a residual value is involved (whether guaranteed or not), the company  would not have to recover as much from the lease payments Economics of Leasing Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor
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Chapter 15-25 (Computation of Rental) Morgan Leasing Company signs an agreement on  January 1, 2007, to lease equipment to Cole Company. The following information relates  to this agreement. 1. The term of the noncancelable lease is 6 years with no renewal option. The equipment has an  estimated economic life of 6 years. 2. The cost of the asset to the lessor is $245,000. The fair value of the asset at January 1, 2007,  is $245,000. 3. The asset will revert to the lessor at the end of the lease term at which time the asset is  expected to have a residual value of $43,622, none of which is guaranteed. 4. The agreement requires annual rental payments, beg.  Jan. 1, 2007. 5. Collectibility of the lease payments is reasonably predictable. There are no important  uncertainties surrounding the amount of costs yet to be incurred by the lessor. Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor
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Chapter 15-26 Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor (Computation of Rental) Assuming the lessor desires a 10% rate of return  on its investment, calculate the amount of the annual rental payment required. 
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Chapter 15-27 a. Operating leases. b. Direct-financing leases. c. Sales-type leases. Classification of Leases by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor
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Chapter 15-28 Classification of Leases by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor If any group 1 conditions are met, plus all group 2 conditions are met, then the lease is a  direct financing or a sales type lease.  A sales-type lease involves a manufacturer’s or  dealer’s profit, and a direct-financing lease does not.
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Chapter 15-29 Classification of Leases by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor
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