Account Titles and Explanation Lease Receivable Debit Cost of Goods Sold Sales Revenue Inventory (To record the lease) Cash 98000.20 i 65000 20456.70 Lease Receivable (To record lease payment) Lease Receivable nnnn3101.74 Interest Revenue Cash Lease Receivable Lease Receivable Lease Receivable Interest Revenue 20456.70 Credit 98000.20 i 65000 20456.70 3101.74 20456.70 3101.74
Need A EXPERT NOT AI
The following facts perta lessee. a non-cancelable lease agreement between Splish Brothers Leasing Company and Sunland Company
Commencement date May 1, 2025
Annual lease payment due at the beginning of
each year, beginning with May 1, 2025 $20,456.70
Bargain purchase option price at end of lease term $4,000
Lease term 5 years
Economic life of leased equipment 10 years
Lessor's cost $65,000
Fair value of asset at May 1, 2025 $98.000.20
Lessor's implicit rate 4 %
Lessee's incremental borrowing rate 4 %
The collectibility of the lease payments by Splish Brothers is probable.
a. Compute the amount of the lease receivable at commencement of the lease
b. Prepare a lease amortization schedule for Splish Brothers for the 5-year lease term. (For
c. Prepare the journal entries to reflect the signing of the lease agreement and to record the receipts and income relate to this lease for the years 2025 and 2026. The lessor's accounting period ends on December 31. Reversing entries are Brothers
AI-generated content may present inaccurate or offensive content that does not represent bartleby’s views.
Unlock instant AI solutions
Tap the button
to generate a solution
