FAR Leases- what am i missing here

  • Creator
    Topic
  • February 19, 2019 at 5:35 pm #2224465
    Ralphie Dos Nachos
    Participant

    so I’m confused how one lease liability is reduced by the total 20,000 pmt but then on the other question the lease liability is only reduced the amortization portion of the lease pmt.

    View post on imgur.com

    View post on imgur.com

    FAR - 76

    AUD - 89

    BEC - 84

    REG - 86

Viewing 1 replies (of 1 total)
  • Author
    Replies
  • February 20, 2019 at 10:17 am #2225193
    Mike
    Participant

    In the first question, the lease payment is made at the beginning of the period- so all payment goes to principal (liability) reduction. In the second question, the effective interest rate method is used to determine the interest component (lease liability * rate implicit in the lease) over the year that the lease was outstanding.

    FAR: 96

    REG: 95

    AUD: 94

    BEC: Scheduled 4/13

  • Author
    Replies
Viewing 1 replies (of 1 total)
  • You must be logged in to reply to this topic.