Animation sold a truck to Peete Finance for $26,050 and immediately leased it back. The truck was carried on Irwin’s books at $20,800. The term of the lease is 5 years, and title transfers to Irwin at lease-end. The lease requires five equal rental payments of $7,048 at the end of each year. The appropriate rate of interest is 11%, and the truck has a useful life of 5 years with no salvage value. Prepare Irwin’s 2012 journal entries. ==============================================
ACC 422 Final Exam Guide 2
FOR MORE CLASSES VISIT www.acc422nerd.com SET 2 1) Which of the following is considered cash? 2) Bank overdrafts, if material, should be 3) Which of the following is NOT considered cash for financial reporting purposes? 4) If a company employs the gross method of recording accounts receivable from customers, then sales discounts taken should be reported as 5) Which of the following methods of determining annual bad debt expense best achieves the matching concept? 6) The advantage of relating a company's bad debt expense to its outstanding accounts receivable is that this approach 7) The failure to record a purchase of mer¬chandise on account even though the goods are properly included in the physical inven¬tory results in 8) Belle Co. received merchandise on consignment. As of March 31, Belle had recorded the transaction as a purchase and included the goods in inventory. The effect of this on its financial statements for March 31 9) Eller Co. received merchandise on consignment. As of January 31, Eller included the goods in inventory, but did NOT record the transaction. The effect of this on its financial statements for January 31 10) The use of a Purchase Discounts account implies that the recorded cost of a purchased inventory item is its 11) Which method of inventory pricing best approximates specific identification of the actual