1. Which of the adhering to statements characterizes an operating lease?A. The lessee documents depreciation and interemainder.B. The lesview records the lease responsibility regarded the leased ascollection.C. The lessor transfers the title of the leased residential or commercial property to the lescheck out for the duration of the lease term.D. The lessor records depreciation and lease revenue.2. Which kind of contract is unique in that it protects the owner against unfavorable activities in the prices or prices while permitting the owner to advantage from favorable movements?A. Interest rate swapB. Forward contractC. Futures contractD. Option3. Cowboy Corporation reported depreciation of $450,000 on its 2002 taxes return. However, in its 2002 revenue statement, Cowboy reported depreciation of $300,000, and $30,000 interest revenue on tax-cost-free bonds. The difference in depreciation is only a momentary difference, and also it will reverse equally over the next 3 years. Cowboy?s enacted revenue taxation prices are as follows:2002 35%2003 30%2004 25%2005 20%What amount should be contained in the deferred revenue tax licapacity in Cowboy?s December 31, 2002, balance sheet?A. $30,000B. $37,500C. $45,000D. $52,5004. Stockton, Inc. leased machinery via a fair value of $250,000 from Layton Machine Co. on December 31, 2001. The contract is a six-year noncancellable lease through an implicit interest price of 10 percent. The lease requires annual payments of $50,000 start December 31, 2001. Stockton appropriately accounted for the lease as a funding lease. Stockton?s increpsychological borrowing price is 12 percent. Assuming the current worth of an annuity due of 1 for 6 years at 10 percent is 4.7908 and the present value of an annuity due of 1 for 6 years at 12 percent is 4.6048, what is the lease licapacity that Stockton need to report on the balance sheet at December 31, 2001?A. $189,540B. $200,000C. $230,240D. $239,5405. The books of the Tracker Company kind of for the year ended December 31, 2002, proved pretaxes income of $360,000. In computing the taxable earnings for federal income taxation functions, the following timing distinctions were taken into account:Depreciation deducted for tax objectives in excess of depreciation tape-recorded on the books, $16,000Income from installment sale reportable for taxation functions in excess of earnings recognized on the publications, $12,000What should Tracker record as its existing federal earnings taxation licapacity at December 31, 2002, assuming a corpoprice earnings taxation rate of 30 percent?A. $99,600B. $103,200C. $106,800D. $108,0006. The president of Technorthern signed a contract for a big purchase of a particular software application program. She then heard rumors that the following generation of that software will be obtainable a lot sooner than expected. The uncertain future sector value of that inventory is a(n)A. price riskB. crmodify riskC. interest rate riskD. exreadjust price risk7. Baxter Company kind of leased tools to Fritz Inc. on January 1, 2002. The lease is for an eight-year period expiring December 31, 2009. The first of eight equal yearly payments of $900,000 was made on January 1, 2002. Baxter had purchased the equipment on December 29, 2001 for $4,800,000. The lease is accordingly accounted for as a sales-kind lease by Baxter. Assume that the existing value at January 1, 2002, of all rent payments over the lease term discounted at a 10 percent interest price was $5,280,000. What amount of interemainder revenue must Baxter record in 2003 (the second year of the lease period) as an outcome of the lease?A. $490,000B. $480,000C. $438,000D. $391,8008. Wideal, Inc. has actually an impetus compensation setup under which the sales manager receives a bonus equal to 10 percent of the company?s income after deductions for bonus and also income taxes. Income before bonus and also income taxes is $400,000. The efficient revenue taxation price is 30 percent. How a lot is the bonus (rounded to the nearemainder dollar)?A. $80,000B. $30,108C. $28,000D. $26,1689. Slice Company type of manufactures devices that they offer or lease. On December 31, 2002, Slice leased tools to Hook Company for a five-year duration after which the ownership of the leased ascollection will certainly be moved to Hook. The lease calls for equal annual payments of $50,000, due on December 31 of annually. The initially payment was made on December 31, 2001. The normal sales price of the devices is $220,000, and also expense is $176,000. For the year ended December 31, 2002, what amount of revenue should Slice report from the lease transaction?A. $10,000B. $30,000C. $44,000D. $74,00010. Frey Corporation?s earnings statement for the year finished December 31, 2002, shows pretaxation revenue of $1,000,000. The following items are treated in a different way on the tax return and also in the accountancy records: Tax Rerotate Accounting RecordsRent Income $70,000 $120,000Depreciation expense 280,000 220,000Premiums on officer?s life insurance - 90,000Assume that Frey?s tax rate for 2002 is 30 percent. What is the amount of revenue taxes payable for 2001?A. $360,000B. $320,000C. $294,000D. $267,00011. Blaine Inc. mirrors the adhering to information relating to its pension plan for 2002:Amortization of unknown net loss $16,000Amortization of unrecognized prior organization price 28,000Expected rerotate on arrangement assets 32,000Actual rerevolve on setup assets 36,000Interemainder on projected benefit responsibility 70,000Service expense 160,000What amount have to Blaine report for pension cost in 2002?A. $206,000B. $238,000C. $242,000D. $270,00012. On December 1, 2002, Blake Inc. signed an operating lease for a warehome for 10 years at $24,000 per year. Upon execution of the lease, Blake passist $48,000 covering rent for the first two years. How a lot have to be presented in Blake?s income statement for the year ended December 31, 2002, as rent expense?A. $0B. $2,000C. $24,000D. $48,00013. Which of the following payroll taxes aren?t passist by the employer?A. FICA taxesB. Federal joblessness taxesC. State joblessness taxesD. State earnings taxes14. The complying with indevelopment relates to the identified benefit pension plan of the McDonald Company kind of for the year ended December 31, 2002:Projected advantage duty, January 1 $4,600,000Projected advantage responsibility, December 31 4,729,000Fair worth of arrangement assets, January 1 5,035,000Fair worth of setup assets, December 31 5,565,000Expected rerevolve on arrangement assets 450,000Amortization of deferred obtain 32,500Employer contributions 425,000Benefits paid to retirees 390,000Settlement price 10%The actual return on setup assets for the year isA. $105,000B. $495,000C. $503,500D. $530,00015. Which of the complying with statements characterizes lessor accountancy for residual values?A. Guaranteed residual worths are included in the gross investment amount, but unguaranteed residual values are excluded from the gross investment.B. Unguaranteed residual values are had in the gross investment amount, but guaranteed residual worths are excluded from the gross investment.C. Guaranteed residual worths and also unguaranteed residual worths are excluded from the gross investment.D. Guaranteed residual values and unguaranteed residual values are had in the gross investment.16. For 3 consecutive years, 1999-2001, Twin Corporation has reported revenue prior to taxes of $100,000 for both financial reporting functions and also taxation reporting purposes. During this time, Twin?s income taxes rates were as follows:1999 20%2000 25%2001 30%In 2002, Twin?s taxation rate changed to 35 percent. Also in 2002, the firm reported a loss for both financial reporting and also taxes reporting objectives of $100,000. Assuming the agency provides the carryearlier provisions, the amount Twin?s must report as an revenue taxes remoney receivable in 2002 is:A. $20,000B. $25,000C. $30,000D. $35,00017. Northwest Company established that it has an responsibility relating to employees? rights to obtain compensation for future absences attributable to employees? services already rendered. The responsibility relates to civil liberties that vest, and also payment of the compensation is probable. The amounts of Northwest?s duties as of December 31 are fairly estimated as follows:Vacation pay $110,000Sick pay 80,000In its December 31 balance sheet, what amount should Northwest report as its licapacity of compensated absences?A. $0B. $80,000C. $110,000D. $190,00018. Throughout the first week of January, Sam Jones earned $200. Assume that FICA taxes are 7.65 percent of wperiods up to $50,000, state unemployment taxes is 5.0 percent of wages approximately $13,000, and also federal joblessness taxes is 0.8 percent of wages approximately $13,000. Assume that Sam has actually voluntary withholdings of $10 (in addition to taxes) and that federal and also state revenue tax withholdings are $18 and also $6, respectively. What is the employer?s payroll taxation expense for the week, assuming that Sam Jones is the only employee?A. $6.32B. $10.00C. $19.05D. $26.9019. The following indevelopment is taken from Blackhawk Corporation?s 2002 financial records:Pretax accounting revenue $1,500,000Excess tax depreciation (45,000)Taxable revenue $1,455,000Assume the taxable short-lived distinction was produced totally in 2002 and will reverse in equal net taxable amounts in each of the following 3 years. If taxes prices are 40 percent in 2002, 35 percent in 2003, 35 percent in 2004, and also 30 percent in 2005, then the complete deferred tax licapability Blackhawk should report on its December 31, 2002 balance sheet is:A. $13,500B. $15,000C. $15,750D. $18,00020. If the actual rerotate on pension money assets exceeds the supposed rerotate for the duration, then difference isA. a deferred lossB. a deferred gainC.

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known as a loss in the present periodD. recognized as a get in the current period