Question

Exercise 21-6 Cullumber Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2017. The lease is for an 8-year period and requires equal annual payments of $35,713 at the beginning of each year. The first payment is received on January 1, 2017. Cullumber had purchased the machine during 2016 for $161,000. Collectibility of lease payments is reasonably predictable, and no important uncertainties surround the amount of costs yet to be incurred by Cullumber. Cullumber set the annual rental to ensure an 11% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Cullumber at the termination of the lease. Click here to view factor tables x Your answer is incorrect. Try again. Compute the amount of the lease receivable. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971.) The amount of the lease receivable 210322 SHOW LIST OF ACCOUNTS LINK TO TEXT VIDEO: SIMILAR EXERCISE Your answer is nartially correct Try again

Answer 1

(1) (1) Amour TF71219 x $35,713 Amount of lease recieuable = $ 204000 17 Lease recienable $204000 COGS $ 161000 Sales Revenue $204000 Inventory $161000 Cash $35713 Lease Recievable $35713 12/31/17 Interest recevable $18512 Interest devenue $ 18512 ( $200 000 - $35713) X1%)