US Kkleso, Intermediate Accounting. Kieso, Intermediate Accounting, 11e, Volume

Question

US Kkleso, Intermediate Accounting. Kieso, Intermediate Accounting, 11e, Volume 2 NTERMEDIATI ACCOUNTING I1 (ACCE 316) & Practice Assignment Gradebook ORION Downloadable eTextbook ssignment Brief Exercise 20-6 Carla vista Ltd., a public company following IFRS 16, recently signed a lease for equipment from Costner td. The lease term is S years and requires equal restal paymients of $28,449 at the beginning of each year. The equipment has a fair value at the wase's inception of $124,900, an estimated useful life of 5 years, and no residual velue. Carla Weta pays sli executory costs directly to third parties. The appropriate interest rate is 7%. Using tables, a financlal calculator, or Excel functions, caloulate the ameunt of the right-of-use asset and ease ability and prepare the initial entry to reflect the signing of the lease agreement and the first payment under the lease. (Credit account titles are automaticaly indented when the amount is entered. Do not indent mavaually. Round factor vañues to S decimal places, e.g. 1.251 and final answers to 0 decimal places, e.g. 5,275.) ACCount Titles and Explanation Credit Question Attempts: 0 of 3 used sAve FOR LATER search 1

Explanation / Answer

Amount of Right to Use asset and Lease liability is equal to Present Value of Rentla Payment made at the Beginning the each year Amount of Right to Use asset and Lease liability ( $28469*4.387)= $124900 Account Titles and Explanation Debit Credit Right of Use Asset $124,900.00 Lease Liability $124,900.00 To Record Lease Liability Lease Liability $28,469.00 Cash $28,469.00 To Record payment of First Rental

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