Bankruptcy, Balance sheetFinance Pages:
Heber W. Howard TO: Trucking lease options This memo is intended to inform you on leasing information in the Financial Accounting Research System FARS and create a recommendation for the regional trucking company as it pertains to their leasing options.
This memo will briefly cover sales-type, direct financing, and operating leases for your information. If a lease does not meet the criteria for capitalization then it will be classified as an operating lease by the lessee. A capital lease transfers most of the benefits and risks of ownership to the lessee.
This should also be accounted for as an acquisition of assets to the lessee. A lease must meet one of four criteria to be considered a capital lease: Need essay sample on Response to Client Request?
In the case of an operating lease this is simply a rental agreement and should be accounted for in the same manner as any other lease. Rent payments are to be charged as an expense as they will be payable over the life of the lease.
A sales-type lease is present when there is a profit or loss that affects a dealer or manufacturer. These leased assets are accounted for as inventory by the lessee and are leased as a marketing tool for the company.
In a sales-type lease the direct costs that goes along with obtaining the lease agreement is written off when the sale is recorded at the inception of the lease.
For a lease to be considered direct financing there must not be a profit or loss recorded by the manufacturer or dealer. For revenue recognition purposes the lessor is viewed as a lending institution. Each payment must be allocated between interest revenue and interest recovery by the lessor.
Initially payments will be applied to the interest portion and slowly migrate to a majority of the payment going to the amount of investment recovery. It is my recommendation that the trucking company consider using a capital lease for the additional trailers.
Response to Client Request 1. The purpose of this response is to determine the difference between direct finance leasing, sales-type leasing or an operating lease for Company ABC. To accomplish this, I will discuss a little background on all of the options and the advantages and disadvantages of a lease. View Homework Help - ACC Week 4 Learning Team Assignment Response to Client Request II from ACC acc at Canada College. Running head: RESPONSE TO CLIENT REQUEST II Response to Client Request. Response to Client Request I ACC/ To: Regional Trucking Company From: The Consulting Group In Re: Leases and Lease Structures A company wants information about leases and lease structures in the FASB codification required by the supervisor in response to the request of the client.
The major benefit of the capital lease is that the trucking company can enter into a lease agreement with the trailer manufacturer and if the business deal does not continue past the initial stages the trucking company can fulfill the lease obligations and continue to move forward with business.
In the event that the business deal has great success and the trucking company wishes to purchase the trailers they may do so at the end of the lease. The trucking company will be able to record these trailers as an asset and may be able to take advantage of some tax benefits available to them.Jun 03, · ACC Response to Client Request II Week 4.
by EliteScoreWriters | Jun 3, | Sample Questions. Your client is being sued. You have asked the client’s lawyer about the possibility of losing the lawsuit.
The client, meanwhile, has asked you to describe what would happen to his or her financial statements. The client has also informed you. Your client is being sued. You have asked the client’s lawyer about the possibility of losing the lawsuit.
The client, meanwhile, has asked you to describe what would happen to his or her financial statements. Response to Client Request I ACC/ To: Regional Trucking Company From: The Consulting Group In Re: Leases and Lease Structures A company wants information about leases and lease structures in the FASB codification required by the supervisor in response to the request of the client.
RESPONSE TO CLIENT REQUEST II 2 Response to Client Request II As requested, the staff has prepared a base analysis of the information you have requested. While the staff waits for the lawyer to determine the probability of a loss in this lawsuit, our staff has researched and prepared an analysis to help educate you and prepare you for the different timberdesignmag.com: Cthornton3.
Nov 21, · Response to Client Request II ACC September 24, Response to Client Request II As requested, the accounting team has analyzed the client’s situation to determine the impact this lawsuit will have.
While the team waits for the client’s attorney to assess the likelihood of a loss in this lawsuit, the team has provided a thorough. Response to Client Ii Response to Client Request II Charles Thornton, Christine Collins, Jose Rodriguez, Vanessa Van Kirk ACC September 23, Sonja Wilson Response to Client Request II As requested, the staff has prepared a base analysis of the information you have requested.