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A long term deferred rent is money a company owes, but hasn't paid, the landlord at the reporting date. Think of this as rent debt, the kind that the business must settle to be in good terms with the property owner. The concept of rent deferral draws on multi-year contractual agreements that businesses sign with landlords, generally with the promise to pay rent periodically, such as every six months or on a quarterly basis. The deferred rent liability account also may arise if a corporate tenant has a temporary financial problem and simply cannot pay rent.
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Should a deferred expense or deferred rent in this example be classified as 'Long Term Liability'?
Deferred Expenses are on the asset side of the balance sheet, not the liability side. Long Term relates to anything beyond the next twelve months, but a long term deferred expense would probably be listed as "Other Assets". The deferred expenses are correctly represent the Assets of the company. But, if a company has not paid its rent & its due in next 12 month or may be due on virtual payment basis in 2-3 years, then such expense (deferred rent) is required to be shown on Liability side of the B/S. Furthermore, such payments to be made in next 12 months are to be presented as Current Liability & payments to be expelled in more than 12 months are to be shown as Non-Current Liability Section.
How do you adjust straight line amortization of deferred rent when lease is extended?
I am not entirely positive. But I believe you would take the balance of the deferred rent liability at relating to the lease prior to expansion and amortize it over the remaining life of the new lease. If deferred rent liability was 10k as of 10/31/2011 and you extended the lease term for two years ending 12/31/2013 you would calculate the new straightline expense of the lease at time of the extension through the end of the lease term and determine the deffered rent liability as of 12/31/2011. Then add 10K/24 = 417X 2 = 834 to the 12/31/2011 deferred rent balance of the new lease You are debiting the deferred rent liability and crediting expense to decrease the deferred rent liability associated with the old lease.
What is the purpose of reporting current maturities of long term debt?
Purpose to report is to show that how much portion of long term debt will be paid or payable in current accounting year that's why that portion became current liability and not long term liability.
What is the current portion of long term debt classified with?
liabilities
What is the current portion of long-term debt classified with?
Current portion of long term loan is classified as current liability and shown under current liability section of balance sheet.
Should a deferred expense or deferred rent in this example be classified as 'Long Term Liability'?
Deferred Expenses are on the asset side of the balance sheet, not the liability side. Long Term relates to anything beyond the next twelve months, but a long term deferred expense would probably be listed as "Other Assets". The deferred expenses are correctly represent the Assets of the company. But, if a company has not paid its rent & its due in next 12 month or may be due on virtual payment basis in 2-3 years, then such expense (deferred rent) is required to be shown on Liability side of the B/S. Furthermore, such payments to be made in next 12 months are to be presented as Current Liability & payments to be expelled in more than 12 months are to be shown as Non-Current Liability Section.
What is a deferred rent payable?
Deferred rent payable is the sum of the difference between a monthly rent payment and the monthly rent expense of an operating lease that contains escalated payments in future periods. The rent expense is the sum of all rent payments over the term of the lease divided by the number of periods contained in the lease otherwise known as straight-line amortization. This rent expense amount can/may differ from the monthly rent payments. The difference is deferred rent payable.
What is deferred rent payable?
Deferred rent payable is the sum of the difference between a monthly rent payment and the monthly rent expense of an operating lease that contains escalated payments in future periods. The rent expense is the sum of all rent payments over the term of the lease divided by the number of periods contained in the lease otherwise known as straight-line amortization. This rent expense amount can/may differ from the monthly rent payments. The difference is deferred rent payable.
How do you adjust straight line amortization of deferred rent when lease is extended?
I am not entirely positive. But I believe you would take the balance of the deferred rent liability at relating to the lease prior to expansion and amortize it over the remaining life of the new lease. If deferred rent liability was 10k as of 10/31/2011 and you extended the lease term for two years ending 12/31/2013 you would calculate the new straightline expense of the lease at time of the extension through the end of the lease term and determine the deffered rent liability as of 12/31/2011. Then add 10K/24 = 417X 2 = 834 to the 12/31/2011 deferred rent balance of the new lease You are debiting the deferred rent liability and crediting expense to decrease the deferred rent liability associated with the old lease.
What is the current portion of long-term debt classified?
The current portion of long-term debt is classified with the ____
How do you adjust straight-line amortization of deferred rent when lease is extended?
When using straight-line rent expense and you amend the lease you take the deferred rent liability at the time of the amendment and amortize it over the life of the new amendment. If you are still required to account for future rent payments on a straight-line basis, you will need to take into account the new lease payments that will be made over the remaining lease term and adjust the future amortization. To do this, you must calculate the total rent expense that will be paid over the revised lease term (i.e. from the original commencement date through the extended termination date). Then, you will subtract the current balance of deferred rent, as this is the portion that has already been amortized. The remaining balance represents the rent expense that needs to be amortized over the remaining life of the lease. Therefore, you will divide this amount by the number of periods remaining in the lease to determine your monthly rent expense journal entry that will be made over the life of the extended lease.
What is the purpose of reporting current maturities of long term debt?
Purpose to report is to show that how much portion of long term debt will be paid or payable in current accounting year that's why that portion became current liability and not long term liability.
What is Deferred Principal balance?
Regarding a HAMP (Home Affordable Mortgage Plan) modification, in order for your new PITA payment to be under the 31% guidelines at 2%, sometimes a portion of the balance owed is deferred to the end of the loan term. By reducing the amount of the balance you're paying as well as its interest, your payment will be under 31% of your income. The deferred amount must be payed later, you still owe it; however it accrues no interest! So a deferred principal balance is the interest FREE portion of your original loan balance. It's just pushed back to a lump sum at the end of the term.
Is prepaid rent a long term asset?
A Long-Term Asset is one in which the benefits of that asset extend beyond the course of a year. The benefits of prepaid rent are typically more immediate, and therefore Prepaid Rent is classified as a Current Asset.
What is the current portion of long term debt classified with?
liabilities
What is the medical term meaning the longitudinal or long portion of a structure?
The axis is the medical term meaning the longitudinal or long portion of a structure. The Axis of the uterus points up and down (cephalocaudally).
What is the current portion of long-term debt classified with?
Current portion of long term loan is classified as current liability and shown under current liability section of balance sheet.
