Question
In: Accounting
On January 1, 2021, Winn Heat Transfer leased office space under a three-year operating lease agreement....
On January 1, 2021, Winn Heat Transfer leased office space under
a three-year operating lease agreement. The arrangement specified
three annual lease payments of $93,000 each, beginning December 31,
2021, and at each December 31 through 2023. The lessor, HVAC
Leasing calculates lease payments based on an annual interest rate
of 8%. Winn also paid a $204,000 advance payment at the beginning
of the lease. With permission of the owner, Winn made structural
modifications to the building before occupying the space at a cost
of $297,000. The useful life of the building and the structural
modifications were estimated to be 30 years with no residual value.
(FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of
$1) (Use appropriate factor(s) from the tables
provided.)
Required:
Prepare the appropriate entries for Winn Heat Transfer from the
beginning of the lease through the end of 2023. Winn’s fiscal year
is the calendar year. (If no entry is required for a
transaction/event, select "No journal entry required" in the first
account field. Round your answers to nearest whole
dollars.)
-
1 Record the beginning of the lease for Winn.
-
2 Record the advance payment made at the beginning of the lease by Winn..
-
3 Record the lease payment for Winn.
-
4 Record the amortization the right-of-use asset for Winn.
-
5 Record depreciation for Winn.
-
6 Record the lease payment for Winn.
-
7 Record the amortization of the right-of-use asset for Winn.
-
8 Record depreciation for Winn.
-
9 Record the lease payment for Winn.
-
10 Record the amortization of the right-of-use asset for Winn.
-
11 Record depreciation for Winn.
Solutions
ekkarill92 answered 1 year agoRelated Solutions
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a three-year operating lease agreement. The arrangement specified
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2021, and at each December 31 through 2023. The lessor, HVAC
Leasing calculates lease payments based on an annual interest rate
of 5%. Winn also paid a $207,000 advance payment at the beginning
of the lease. With permission of the owner, Winn made structural
modifications to the building before occupying the...
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Leasing calculates lease payments based on an annual interest rate
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