Which of the Following Is an Appropriate Journal Entry for the Initial

question 2

Multiple Choice

Which of the following is an appropriate journal entry for the initial recognition by a lessee of a finance lease arrangement?

• A) DR Leased asset CR Bank loan;
• B) DR Cash CR Leased asset;
• C) DR Lease liability CR Leased asset;
• D) DR Leased asset CR Lease liability.

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Definitions:

Job Cost Sheet

A document that records and tracks the costs associated with a specific job or project, including materials, labor, and overhead.

Receiving Report

A document used by a company to record the receipt of goods from a supplier, detailing the quantity and condition of the items received.

Purchased Materials

Refers to the raw materials bought by a company to be used in production or merchandise bought for resale.

Manufacturing Department

A specific division within a company that is responsible for the production of goods.