Business, 30.03.2020 17:01, 2337911726

At January 1, 2021, Café Med leased restaurant equipment from Crescent Corporation under a nine-year lease agreement. The lease agreement specifies annual payments of $26,000 beginning January 1, 2021, the beginning of the lease, and at each December 31 thereafter through 2028. The equipment was acquired recently by Crescent at a cost of $189,000 (its fair value) and was expected to have a useful life of 13 years with no salvage value at the end of its life. Crescent records depreciation using the straight-line method. Crescent seeks a 8% return on its lease investments. By this arrangement, the lease is deemed to be an operating lease.

Required:
1. What will be the effects of the lease on Crescent's earnings for the first year (ignore taxes)? (Enter decreases with negative numbers.)
2. What will be the balances in the balance sheet accounts related to the lease at the end of the first year for Crescent (ignore taxes)?
(For all requirements, round your intermediate calculations to the nearest whole dollar amount.)

Answers: 1

Show answers

Other questions on the subject: Business

Business, 22.06.2019 13:30, karenjunior

Over the past year, three of the star salesmen at family resorts international's corporate office have been lured away to competitors. on top of that, karina, the general manager of the sales department, has noticed that most employees come in, do their jobs, and leave. family resorts offers a good salary, benefits, and tuition reimbursement, as well as a number of development and training programs. most employees seem contented enough, but karina would like to do something to increase the level of engagement among her staff. what do you think karina should do?

Answers: 1

continue

Business, 22.06.2019 17:00, whitakers87

Dan wants to start a supermarket in his hometown, and wants to get into the business only after finding out about the market and how successful his business might be. the best way for dan to gain knowledge is to:

Answers: 2

continue

Business, 22.06.2019 19:40, jair512872

Lauer corporation uses the periodic inventory system and has provided the following information about one of its laptop computers: date transaction number of units cost per unit 1/1 beginning inventory 210 $ 910 5/5 purchase 310 $ 1,010 8/10 purchase 410 $ 1,110 10/15 purchase 255 $ 1,160 during the year, lauer sold 1,025 laptop computers. what was cost of goods sold using the lifo cost flow assumption?

Answers: 1

continue

Business, 22.06.2019 22:10, jpimentel2021

What is private equity investing? who participates in it and why? how is palamon positioned in the industry? how does private equity investing compare with public market investing? what are the similarities and differences between the two? why is palamon interested in teamsystem? does it fit with palamon’s investment strategy? how much is 51% of teamsystem’s common equity worth? use both a discounted cash flow and a multiple-based valuation to justify your recommendation. what complexities do cross-border deals introduce? what are the specific risks of this deal? what should louis elson recommend to his partners? is it a go or not? if it is a go, what nonprice terms are important? if it’s not a go, what counterproposal would you make?

Answers: 1

continue

Do you know the correct answer?

At January 1, 2021, Café Med leased restaurant equipment from Crescent Corporation under a nine-year...