Journalizing: It is the process of recording the transactions of an organization in a chronological order. Based on these journal entries recorded, the amounts are posted to the relevant ledger accounts. Accounting rules for journal entries: To increase balance of the account: Debit assets, expenses, losses and credit all liabilities, capital, revenue and gains. To decrease balance of the account: Credit assets, expenses, losses and debit all liabilities, capital, revenue and gains. Operating Lease: The type of lease used to acquire or use the asset for a short time period is called operating lease. The underlying asset is acquired and used by different parties during its useful life. Capital Lease: The type of lease that provides full ownership to lessee is called capital lease. The lessor provides required funds to acquire the assets and lessee has the right to use that asset based on the lease agreement. To record: The journal entries for lease transactions.

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Chapter 15, Problem 15.10BE

To determine

Journalizing: It is the process of recording the transactions of an organization in a chronological order. Based on these journal entries recorded, the amounts are posted to the relevant ledger accounts.

Accounting rules for journal entries:

To increase balance of the account: Debit assets, expenses, losses and credit all liabilities, capital, revenue and gains.

To decrease balance of the account: Credit assets, expenses, losses and debit all liabilities, capital, revenue and gains.

Operating Lease: The type of lease used to acquire or use the asset for a short time period is called operating lease. The underlying asset is acquired and used by different parties during its useful life.

Capital Lease: The type of lease that provides full ownership to lessee is called capital lease. The lessor provides required funds to acquire the assets and lessee has the right to use that asset based on the lease agreement.

To record: The journal entries for lease transactions.

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