Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. maris co. purchased a machine on january 1, 2018,

Maris Co. purchased a machine on January 1, 2018, for $700,000 for the express purpose...

60.1K

Verified Solution

Question

Accounting

Maris Co. purchased a machine on January 1, 2018, for $700,000 for the express purpose of leasing it. The machine is expected to have a 5-year life, no salvage value, and be depreciated on a straight-line monthly basis. On April 1, 2018, under a cancelable lease, Maris leased the machine to Dunbar Company for $450,200 a year for a 4-year period ending March 31, 2022. Maris incurred total maintenance and other related costs under the provisions of the lease of $16,000 relating to the year ended December 31, 2018. Harley paid $450,200 to Maris on April 1, 2018.

1. Under the operating method, what should be the income before income taxes derived by Maris Co. from this lease for the year ended December 31, 2018? (Round answer to 0 decimal places, e.g., $1,575.)

Income before income taxes $

2. What should be the amount of rent expense incurred by Dunbar from this lease for the year ended December 31, 2018?

Rent expense $

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Statistics
1.2K views

The mean game scores and standard deviations of four seasons of a football team are...

Physics
1.2K views

Water flows through a 3 inch diameter pipe at a velocity of 10 ft/s. Find the...

Biology
1.2K views

What differentiates presumptive neural plate cells from the rest of the ectoderm a neural plate...

Physics
1.2K views

Convection 3 Conduction 4 Temperature remains same 36 A liquid cools down from 70 C...

Geometry
1.2K views

OO C 38 yd C 44 yd What is the ratio of the diameter of...

Basic Math
1.2K views

Beginning Month Work in Process January March July Company has the following production data for...

Basic Math
1.2K views

A jar contains 3 red, 5 green, 2 blue and 6 yellow marbles. A marble...

Algebra
1.2K views

18.a.Sketch the graph of each of the following on the given coordinates plane. (4 points...

Algebra
1.2K views

Software LLC 6 Sa 6 3b A B C D Sab 6a 4b b 3...

Accounting
1.2K views

which of the following is a requirement regarding replacement property for deferred like kind exchange...

Accounting
1.2K views

Need B Current Attempt in Progress Alan Weatherspoon, a super...

Finance
1.2K views

. a) Will use of NPV in capital project evaluation always give the same answer...