« previous next »

Author Question: A city acquires equipment on January 1, 2013 by means of a capital lease agreement. The agreement ... (Read 71 times)

lindiwe

  • Hero Member
  • *****
  • Posts: 577
on: Jul 5, 2018
A city acquires equipment on January 1, 2013 by means of a capital lease agreement. The agreement calls for paying the leasing company 300,000 in three 100,000 annual payments, starting December 31, 2013 .
 
  The present value of the three lease payments, using a 6 interest rate, is 267,300 . The city will make the lease payments from the General Fund. What journal entry should the city make on January 1, 2013 in the Fund?
   a. debit expenditures - capital outlay; credit other financing sources, for 300,000
   b. debit expenditures - capital outlay; credit other financing sources, for 267,300
   c. debit capital assets; credit capital leases payable, for 300,000
   d. debit expenditures - capital outlay; credit capital leases payable, for 267,300

Question 2

No entries are made in the Posting Reference column in a two-column journal when journalizing.
 a. True
   b. False
   Indicate whether the statement is true or false


coreycathey

  • Sr. Member
  • ****
  • Posts: 333
Reply #1 on: Jul 5, 2018
Answer to Question 1

b

Answer to Question 2

True


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

There used to be a metric calendar, as well as metric clocks. The metric calendar, or "French Republican Calendar" divided the year into 12 months, but each month was divided into three 10-day weeks. Each day had 10 decimal hours. Each hour had 100 decimal minutes. Due to lack of popularity, the metric clocks and calendars were ended in 1795, three years after they had been first marketed.

Did you know?

Anesthesia awareness is a potentially disturbing adverse effect wherein patients who have been paralyzed with muscle relaxants may awaken. They may be aware of their surroundings but unable to communicate or move. Neurologic monitoring equipment that helps to more closely check the patient's anesthesia stages is now available to avoid the occurrence of anesthesia awareness.

Did you know?

Hippocrates noted that blood separates into four differently colored liquids when removed from the body and examined: a pure red liquid mixed with white liquid material with a yellow-colored froth at the top and a black substance that settles underneath; he named these the four humors (for blood, phlegm, yellow bile, and black bile).

Did you know?

Cucumber slices relieve headaches by tightening blood vessels, reducing blood flow to the area, and relieving pressure.

Did you know?

Drug-induced pharmacodynamic effects manifested in older adults include drug-induced renal toxicity, which can be a major factor when these adults are experiencing other kidney problems.

Scoliometer and Its Use, Equipment Scoliometer and Its Use, Equipment
Explanet Discoveries in 2013 Explanet Discoveries in 2013
Members of the British Punitive Expedition to Benin City Members of the British Punitive Expedition to Benin City
Share of Human Capital in Wages in Developing Countries Share of Human Capital in Wages in Developing Countries
World Mean Sea-Level Temperatures in January World Mean Sea-Level Temperatures in January
January 15 2024 January 15 2024
Video: Inflammation

For a complete list of videos, visit our video library