A Six-Year-Capital Lease Entered into on December 31,2016,specified Equal Minimum

question 9

Multiple Choice

A six-year-capital lease entered into on December 31,2016,specified equal minimum annual lease payments due on December 31,2017.Minimum payment applicable to which of the following increased over the corresponding December 31,2017,minimum payment? The company is applying SFAS No.13) Reduction of
Interest Expense Liability

• A)Yes Yes
• B)Yes No
• C)No Yes
• D)No No

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Definitions:

Trial Balance

A financial statement that lists all balances in a firm's general ledger accounts at a specific point in time to verify that debits equal credits.

Account Balance

The amount of money in a financial repository, such as a bank account, at any given moment.

Interest Receivable

An accounting term referring to the interest income that has been earned but not yet received in cash.

Accounts Payable

Liabilities of a business that represent amounts due to suppliers or creditors for goods and services received but not yet paid for.