Kieso_IA_16e_PPT_Ch21v2.pptx

# Sterling would capitalize the amount as follows lo 4

• 60

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Sterling would capitalize the amount as follows: LO 4 Unguaranteed Residual Value (Lessee Accounting) SPECIAL LEASE ACCOUNTING PROBLEMS ILLUSTRATION 21-20 Computation of Lessee’s Capitalized Amount— Unguaranteed Residual Value

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21-54 Unguaranteed Residual Value (Lessee) LO 4 ILLUSTRATION 21-21 Lease Amortization Schedule for Lessee— Unguaranteed Residual Value
21-55 LO 4 Comparative Entries ILLUSTRATION 21-23 Comparative Entries for Guaranteed and Unguaranteed Residual Values, Lessee Company

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21-56 Illustration: Assume a direct-financing lease with a residual value (either guaranteed or unguaranteed) of \$5,000. Caterpillar determines the payments as follows. Lessor Accounting for Residual Value The lessor works on the assumption that it will realize the residual value at the end of the lease term whether guaranteed or unguaranteed. LO 4 SPECIAL LEASE ACCOUNTING PROBLEMS ILLUSTRATION 21-24 Computation of Direct-Financing Lease Payments
21-57 LO 4 Lessor Accounting for Residual Value ILLUSTRATION 21-25 Lease Amortization Schedule, for Lessor— Guaranteed or Unguaranteed Residual Value

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21-58 LO 4 ILLUSTRATION 21-25 Caterpillar would make the following entry on January 1, 2017. Lease Receivable 100,000.00 Equipment 100,000.00
21-59 LO 4 ILLUSTRATION 21-25 Cash 25,237.09 Lease Receivable 23,237.09 Property Tax Expense/Property Taxes Payable 2,000.00 Caterpillar would make the following entry on January 1, 2017.

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21-60 LO 4 ILLUSTRATION 21-25 Caterpillar would make the following entry on December 31, 2017. Lease Receivable 7,676.29 Interest Revenue 7,676.29
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• Spring '14
• Depreciation, Lessee, Lessor, Finance lease, Caterpillar

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