On January 1, 2016, Nath-Langstrom Services, Inc., a computer software training

Question

On January 1, 2016, Nath-Langstrom Services, Inc., a computer software training firm, leased several computers from ComputerWorld Corporation under a two-year operating lease agreement. The contract calls for four rent payments of $13,000 each, payable semiannually on June 30 and December 31 each year. The computers were acquired by ComputerWorld at a cost of $96,000 and were expected to have a useful life of eight years with no residual value. Required: Prepare the appropriate entries for the lessee (Use straight-line depreciation.)

1. Record the lease payment for June 30, 2016

2. Record the lease payment for Dec 31, 2016

3. Record cash received June 30, 2016, Dec 31, 2016, and

4. Depreciation expense Dec 31, 2016

Explanation / Answer

Answer

The appropriate entries for Nath-Langstrom Services, Inc.:

The appropriate entries for ComputerWorld Corporation:

Depreciation exp.=Cost of assets / life of assets

=$96000/8

=$12000

Date Particulars Dr Cr June 30, 2016 Rent Expenses $13000 Cash $13000 (Being record the payment of rent) Dec 31, 2016 Rent Expenses $13000 Cash $13000 (Being record the payment of rent)

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.