intermediateaccountingleases(编辑修改稿)

intermediateaccountingleases(编辑修改稿)内容摘要：

of equipment is used, the amortization entry for 2020 is shown below: (continues) 1531 Prepaid Executory Costs 5,000 Obligations under Capital Leases 40,981 Interest Expense 19,019 Cash 65,000 Accounting for Capital Leases—Lessee Entries on December 31, 2020 ($250,192 – $60,000) 1532 Accounting for Leases with a Bargain Purchase Option • Frequently, the lessee is given the option of purchasing the property in the future at what appears to be a bargain price. • The present value of the bargain purchase option would be added to the present value of the minimum lease payments to establish the initial asset and liability. 1533 • There is a bargain purchase option of $75,000 exercisable after five years Lessee Accounting for Leases with a Bargain Purchase Option • Lease period: 5 years, beginning January 1, 2020, noncancelable • Rent amount: $65,000 per year payable annually in advance。 includes $5,000 to cover executory costs • Estimated economic life of equipment: 5 years • Expected residual value of equipment at end of lease period: None These are the same facts as before, but wi h one new item. 1534 Minimum Lease Payment Present value of five payments at the beginning of each year for five years: PMT = $60,000, N = 5, I = 10% $250,192 Present value of the bargain purchase option of $75,000 at the end of 5 years: FV = $75,000, N = 5, I = 10% 46,569 Present value of minimum lease payment $296,761 Accounting for Leases with a Bargain Purchase Option 1535 1536 Entries on December 31, 2020 Obligations under Capital Leases 68,182 Interest Expense 6,818 Cash 75,000 To record exercise of bargain purchase option. Equipment 148,381 Accumulated Amortization on Leased Equipment 148,380 Leased Equipment 296,761 To transfer remaining balance in leased asset account to Equipment. $68,182 10% ($296,761 247。 10) 5 years Accounting for Leases with a Bargain Purchase Option 1537 Accounting for Leases with a Bargain Purchase Option If the equipment is not purchased and the lease is permitted to lapse, the following entry is required on December 31, 2020: Loss from Failure to Exercise Bargain Purchase Option 73,381 Obligation under Capital Leases 68,182 Interest Expense 6,818 Accumulated Amortization on Leased Equipment 148,380 Leased Equipment 296,761 . 1538 Accounting for Purchase of Asset During Lease Term On December 31, 2020, the lessee purchased the leased property in the Marshall Corporation example for $120,000. At that date, the remaining liability recorded on the lessee’s books is $114,545 and the book value of the recorded leased asset is $100,078 [capitalized value of $250,192 less $150,114 amortization ($50,038 3)]. (continues) 1539 Given the facts in Slide 1538, the entry to record the purchase on the lessee’s books would be as follows: Interest Expense 10,413 Obligation under Capital Leases 104,132 Equipment 105,533 Accumulated Amortization on Leased Equipment 150,114 Leased Equipment 250,192 Cash 120,000 [$100,078 + ($120,000 – $114,545)] Accounting for Purchase of Asset During Lease Term 1540 In 2020, Marshall Corporation’s ine before any leaserelated expenses is $200,000. Net ine for the year is puted as follows: Ine before leaserelated expenses $200,000 Leaserelated interest expense (19,019) Leaserelated amortization expense (50,038) Net ine $130,943 Treatment of Leases on Lessee’s Statement of Cash Flows 1541 Accounting for Leases—Lessor Direct financing leases involve a lessor who is primarily engaged in financing activities, such as a bank or finance pany. Salestype leases involve manufacturers or dealers who use leases as a means of facilitating the marketing of their products. 1542 Revenue Generated by a SalesType Lease A salestype lease generates two different types of revenue: 1. An immediate profit or loss, which is the difference between the cost of the property being leased and its sales price, or fair value, at the inception of the lease 2. Interest revenue earned over time as the lessee makes the lease payments 1543 Accounting for Operating Leases—Lessor Minimum payment (in advance) including $5,000 executory cost $65,000/year Lease period (beginning Jan. 1, 2020) 5 years Economic life of asset 10 years Estimated residual value at end of lease $0 Implicit rate 10% Incremental borrowing rate 10% Cost to l。