Questions from Intermediate Accounting

Q: How does an installment note differ from a note for which the

How does an installment note differ from a note for which the principal is paid as a single amount at maturity?

Q: How are leases and installment notes the same? How do they

How are leases and installment notes the same? How do they differ?

Q: A lessee should classify a lease transaction as a finance lease if

A lessee should classify a lease transaction as a finance lease if it is noncancelable and one or more of five classification criteria are met. Otherwise, it is an operating lease. What are these crit...

Q: Lukawitz Industries leased non-specialized equipment to Seminole Corporation for a

Lukawitz Industries leased non-specialized equipment to Seminole Corporation for a four-year period, at which time possession of the leased asset will revert back to Lukawitz. The equipment cost Lukaw...

Q: In accounting for a finance lease/sales-type lease,

In accounting for a finance lease/sales-type lease, how are the lessee’s and lessor’s income statements affected?

Q: What is selling profit on a sales-type lease? How

What is selling profit on a sales-type lease? How do we account for a sales-type lease with a selling profit?

Q: At the beginning of an operating lease, the lessor will record

At the beginning of an operating lease, the lessor will record what asset or assets, if any?

Q: Branif Leasing leases mechanical equipment to industrial consumers under sales-type

Branif Leasing leases mechanical equipment to industrial consumers under sales-type leases that earn Branif a 10% rate of return for providing long-term financing. A lease agreement with Branson Const...

Q: Target Corporation prepares its financial statements according to U.S.

Target Corporation prepares its financial statements according to U.S. GAAP. Target’s financial statements and disclosure notes for the year ended January 30, 2016, are available in Connect. This mate...

Q: In accounting for an operating lease, how are the lessee’s and

In accounting for an operating lease, how are the lessee’s and lessor’s income statements affected?