Question

In: Accounting

The city of Brock’s Water Enterprise Fund leases water treatment equipment. The life of the noncancel-lable...

The city of Brock’s Water Enterprise Fund leases water treatment equipment. The life of the noncancel-lable lease is 10 years, and the expected life of the equipment is 12 years. Using an 8 percent interest rate, the present value of the lease payments is $905,861. The first payment of $125,000 is due when the lease begins, January 5, 2018. An additional payment is due on January 5th for each of the next 9 years. Prepare journal entries to record:

1. The lease of the equipment on January 5, 2018.

2. The first lease payment on January 5, 2018.

3. Amortization expense for fiscal year ending December 31, 2018

4. The second lease payment on January 5, 2019

Solutions

Expert Solution

ekkarill92 answered 11 months ago
Next > < Previous

Related Solutions

1) The city of Trawville has a water enterprise fund that provides potable water for use...
1) The city of Trawville has a water enterprise fund that provides potable water for use by the residents and businesses of the city. The water enterprise fund also provides potable water to other city departments. The water enterprise fund bills the General fund $1800 and the golf course fund $1600 for the water use during the most recent month. What journal entry should be recorded in the Water enterprise fund? 2) The City of Bethville Established an Internal Service...
6–C. Part 2. Enterprise Fund Transactions The City of Monroe maintains a Water and Sewer Fund...
6–C. Part 2. Enterprise Fund Transactions The City of Monroe maintains a Water and Sewer Fund to provide utility services to its citizens. As of January 1, 2017, the City of Monroe Water and Sewer Fund had the following account balances: Debits Credits Cash $ 98,000 Customer Accounts Receivable 84,000 Estimated Uncollectible Accounts Receivable $4,000 Materials and Supplies 28,000 Advance to Stores and Services Fund 30,000 Restricted Assets 117,000 Water Treatment Plant in Service 4,200,000 Construction Work in Progress 203,000...
The City of Pfeiffer starts the year of 2017 with the general fund and an enterprise...
The City of Pfeiffer starts the year of 2017 with the general fund and an enterprise fund. The general fund has two activities: education and parks/recreation. For convenience, assume that the general fund holds $123,000 cash and a new school building costing $1 million. The city utilizes straight-line depreciation. The building has a 20-year life and no salvage value. The enterprise fund has $62,000 cash and a new $600,000 civic auditorium with a 30-year life and no salvage value. The...
The City of Pfeiffer starts the year of 2017 with the general fund and an enterprise...
The City of Pfeiffer starts the year of 2017 with the general fund and an enterprise fund. The general fund has two activities: education and parks/recreation. For convenience, assume that the general fund holds $144,000 cash and a new school building costing $1,180,000. The city utilizes straight-line depreciation. The building has a 20-year life and no salvage value. The enterprise fund has $65,000 cash and a new $360,000 civic auditorium with a 30-year life and no salvage value. The enterprise...
The Iowa City Water Treatment Plant and the University of Iowa Water Treatment Plant remove calcium...
The Iowa City Water Treatment Plant and the University of Iowa Water Treatment Plant remove calcium hardness (Ca2+) by precipitating (making) CaCO3(s). If, after establishing equilibrium with CaCO3(s), the dissolved Ca2+ concentration is 10 mg/L and the pH is 10.5. a. What is the CO32- concentration in mol/L? b. What is the HCO3- concentration in mol/L? c. What is the alkalinity in mg/L as CaCO3?
The City of Saltwater Beach established an enterprise fund in 2015 to construct and operate Tribute...
The City of Saltwater Beach established an enterprise fund in 2015 to construct and operate Tribute Aquatic Center, a public swimming pool. The pool was completed and began operations in 2016. All costs, including repayment of debt, are to be paid by user fees. The fund’s pre-closing trial balance as of December 31, 2017 is shown below. Debits Credits   Cash and Cash Equivalents $ 182,640   Accounts Receivable 5,240   Supplies 8,250   Restricted Cash and Cash Equivalents 944,860   Land 1,404,250   Buildings and...
Journal entries and financial statements for an Enterprise Fund The City of Whitt Falls plans to...
Journal entries and financial statements for an Enterprise Fund The City of Whitt Falls plans to develop a golf course during 2018 and account for it as the Golf Enterprise Fund (GEF). The course will be built on a parcel of land to be purchased from a private party. The planned out-of-pocket costs for the new course and their financing are as follows: Spending Acquisition of land from private party $ 500,000 Installation of sod, sprinklers, landscaping, and fencing 1,000,000...
On January 1, 2017, the Mount Rogers City water department leases a truck under a noncancelable...
On January 1, 2017, the Mount Rogers City water department leases a truck under a noncancelable lease agreement meeting the requirements for classification as a capital lease. The present value (8% interest) of the minimum lease payment is $45000, and the lease calls for five annual lease payments of $10435 every January 1, beginning in 2017. The leased truck has a five year life and no salvage. 1. Prepare journal entries for the first year of the lease. 2. How...
Suppose that a city has to justify the net benefits of a proposed water treatment plant....
Suppose that a city has to justify the net benefits of a proposed water treatment plant. (A) Name and discuss the importance of the four things that the City must consider in terms of estimating the Present Value of Net Benefits (PVNB). (B) Calculate the PVNB’s from the following information: Year​ 0 ​1​ 2​ 3​ 4​ 5​ 6​ Cost​ 100 ​ 50​ 30​ 20​ 20​ 10​ 10​​ Benefit​ 10​ 20 ​20​ 40​ 100​ 120​ 150​ (i) PVNB (@ 4%) =...
The city of Bloomington is about to build a new water treatment plant. Once the plant...
The city of Bloomington is about to build a new water treatment plant. Once the plant is designed (D) we can select the site (S), the building contractor (C and the operating personnel (P). Once the site is selected we may erect the building (B). We can order the water treatment machine (W) and prepare the operations manual (M) only after the contractor is selected. We can begin training the operators (T) when both the operations manual and operating personnel...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT