Use the same information as in (8). What amount of deferred lease revenue will Reynolds report on its statement of net position as of December 31, 2020, assuming that the county recognizes revenue on straight-line method?
a. Zero
b. $487,419
c. $500,000
d. $511,790
Data from problem 8
Reynolds County has three large trucks with a total net book value of $600.000 and remaining lives of six years with no expected residual value. County officials lease the trucks to the City of Webster on January 1, 2020, for six years. Based on a negotiated annual implicit interest rate of 5 percent, the parties agree on annual payments of $112,581 beginning immediately and each January 1 thereafter. For both governments, the trucks relate to activities maintained with the General Fund. What amount of depreciation expense will Reynolds report in its government-wide financial statements for 2020?
