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Accounting by the lessor a lessor may classify a

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Accounting by the Lessor A lessor may classify a lease as an  operating lease but the lessee may classify the same  lease as a  capital lease.
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Chapter 15-30 In substance the financing of an asset purchase by the lessee. Direct-Financing Method (Lessor) Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor
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Chapter 15-31 Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Prepare an amortization schedule that would be suitable for the lessor.  10% Recovery Lease I nterest of Lease Date Payment Revenue Receivable Receivable 1/ 1/ 07 245, 000 $ 1/ 1/ 07 46, 000 $ 46, 000 $ 199, 000 12/ 31/ 07 46, 000 19, 900 26, 100 172, 900 12/ 31/ 08 46, 000 17, 290 28, 710 144, 190 12/ 31/ 09 46, 000 14, 419 31, 581 112, 609 12/ 31/ 10 46, 000 11, 261 34, 739 77, 870 12/ 31/ 11 46, 000 7, 787 38, 213 39, 657 12/ 31/ 12 43, 622 3, 965 39, 657 0 * * rounding * *
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Chapter 15-32 Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Prepare all of the journal entries for the lessor for 2007 and 2008.
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Chapter 15-33 Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Prepare all of the journal entries for the lessor for 2007 and 2008.
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Chapter 15-34 Records each rental receipt as rental revenue.  Depreciates the leased asset in the normal manner. Any prepaid or noneconomic payment patters are straight-lined. Operating Method (Lessor) Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor Accounting by the Lessor
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Chapter 15-35 1. Residual values. 2. Sales-type leases (lessor). 3. Bargain purchase options. 4. Initial direct costs. 5. Sale-Leaseback 6. Current versus noncurrent classification. 7. Disclosure. Special Accounting Problems Special Accounting Problems Special Accounting Problems Special Accounting Problems
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Chapter 15-36 Lessee Accounting for Residual Value The accounting consequence is that the  minimum lease payments  include the guaranteed residual value but excludes the  unguaranteed residual value. Residual Values Special Accounting Problems Special Accounting Problems Special Accounting Problems Special Accounting Problems
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Chapter 15-37 Illustration (LESSEE and LESSOR Computations and Entries)   On  Jan. 1, 2007, Velde Company (lessee) entered into a four-year, noncancellable contact to  lease a computer for Exceptional Computer Company (lessor).  Annual rentals of $16,228  are to be paid each Jan. 1. The cost of the computer to Exceptional Computer Company  was $60,000 and has an estimated useful life of four years and a $5,000 residual value.  Velde has  guaranteed  the lessor a  residual value  of $5,000. Velde has an incremental  borrowing rate of 12% but has knowledge that Exceptional computer Company used a  rate of 10% in setting annual rentals. Collection of the rentals is reasonably predictable  and there are no important uncertainties regarding future unreimbursable costs to be  incurred by the lessor.
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