Elf Leasing purchased a machine for $510,000 and leased it to IGA, Incorporated on January 1, 2024. Lease description: Quarterly rental payments Lease tere No residual value; no BPO Economic life of machine Implicit interest rate and lessee's incremental borrowing rate Fair value of asset $29,237 at beginning of each period 6 years (24 quarters) Complete this question by entering your answers in the tabs below. 6 years 12% $510,000 Required: Prepare appropriate entries for both IGA and Elf Leasing from the beginning of the lease through the second rental payment on Ap 2024. Amortization is recorded at the end of each fiscal year (December 31).
Elf Leasing purchased a machine for $510,000 and leased it to IGA, Incorporated on January 1, 2024. Lease description: Quarterly rental payments Lease tere No residual value; no BPO Economic life of machine Implicit interest rate and lessee's incremental borrowing rate Fair value of asset $29,237 at beginning of each period 6 years (24 quarters) Complete this question by entering your answers in the tabs below. 6 years 12% $510,000 Required: Prepare appropriate entries for both IGA and Elf Leasing from the beginning of the lease through the second rental payment on Ap 2024. Amortization is recorded at the end of each fiscal year (December 31).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Lessee
Prepare appropriate entries for Elf Leasing from the beginning of the lease through the second rental payment on April 1, 2024.
Amortization is recorded at the end of each fiscal year (December 31).
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to
the nearest whole dollar amounts,
View transaction list View journal entry worksheet
1
Lessor
No
1
2
3
Date
January 01, 2024 Lease receivable
Equipment
January 01, 2024 Cash
April 01, 2024
Lease receivable
Cash
Lease receivable
Interest revenue
General Journal
Debit
510,000
29,237
20,237
Credit
510.000
29.237
14,814
14,423
Show less A
Transcribed Image Text:Elf Leasing purchased a machine for $510,000 and leased it to IGA, Incorporated on January 1, 2024.
Lease description:
Quarterly rental payments
Lease tere
No residual value; no BPO
Economic life of machine
Implicit interest rate and lessee's incremental borrowing rate
Fair value of asset
$29,237 at beginning of each period
6 years (24 quarters)
Complete this question by entering your answers in the tabs below.
6 years
12%
$510,000
Required:
Prepare appropriate entries for both IGA and Elf Leasing from the beginning of the lease through the second rental payment on Ap
2024. Amortization is recorded at the end of each fiscal year (December 31).
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