Determine the amount of deferred revenue


Problem 1: On December 31, 2017, Bramble Inc. sold computer equipment to Daniell Co. and immediately leased it back for 10 years. The sales price of the equipment was $515,900, its carrying amount is $396,200, and its estimated remaining economic life is 12 years. Determine the amount of deferred revenue to be reported from the sale of the computer equipment on December 31, 2017.

Problem 2: On December 31, 2017, Sunland Co. sold a machine to Cross Co. and simultaneously leased it back for one year. The sales price of the machine was $480,300, the carrying amount is $417,300, and it had an estimated remaining useful life of 14 years. The present value of the rental payments for the one year is $35,000. At December 31, 2017, how much should Sunland report as deferred revenue from the sale of the machine?

Problem 3: On January 1, 2017, Coronado Corp. sold an airplane with an estimated useful life of 10 years. At the same time, Coronado leased back the plane for 10 years. The sales price of the airplane was $504,900, the carrying amount $381,700, and the annual rental $73,315. Coronado Corp. intends to depreciate the leased asset using the sum-of-the-years'-digits depreciation method. How much gain on the sale should be reported at the end of 2017 in the financial statements?

Problem 4: On January 1, 2017, Whispering Co. sold equipment with an estimated useful life of 5 years. At the same time, Whispering leased back the equipment for 2 years under a lease classified as an operating lease. The sales price (fair value) of the equipment was $214,800, the carrying amount is $298,500, the monthly rental under the lease is $5,900, and the present value of the rental payments is $114,606. For the year ended December 31, 2017, determine which items would be reported on its income statement for the sale-leaseback transaction.

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Accounting Basics: Determine the amount of deferred revenue
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