On February 20, 2008, Barbara Brent Inc., purchased a machine for $1,500,000 for the purpose of leasing it. The machine is expected to have a 10-year life, no residual value, and will be depreciated on the straight-line basis. The machine was leased to Chuck Rudy Company on March 1, 2008, for a 4-year period at a monthly rental of $19,500. There is no provision for the renewal of the lease or purchase of the machine by the lessee at the expiration of the lease term. Brent paid $30,000 of commissions associated with negotiating the lease in February 2008.
(a) What expense should Chuck Rudy Company record as a result of the facts above for the year ended December 31, 2008? Show supporting computations in good form.
(b) What income or loss before income taxes should Brent record as a result of the facts above for the year ended December 31, 2008?
Using budget data, how many Apple iPhone 4’s would have to have been completed for Danshui Plant No. 2 to break even? 2. Using budget data, what was the total expected cost per unit if all manufacturing and shipping overhead (both variable and fixed) were allocated to...