In this simulation, you are asked to address questions related to the accounting for leases. Prepare responses to all parts. (Round amounts to the nearestcent.)

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KWW Professional Simulation Time Remaining 1 hour 40 minutes Accounting for Leases Unsplit Spit Horiz Spit Vertical Spreadsheet Cakulator Exit Situation Explanation Mossurement Jourmal Entry Directions Resources On January 1, 2012, Dexter Labs, Inc. signed a 5-year noncancelable lease for a machine. The terms of the lease called for Dexter to make annual payments of $8,668 at the beginning of each year, starting January 1, 2012. The machine has an estimated useful life of 6 years and a $5,000 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Dexter uses the straight-line method of depreciation for all of its plant assets. Dexter's incremental borrowing rate is 10%, and the lessor's implicit rate is unknown. Directions Situation Explanation Measurement Journal Entry Resources What type of lease is this? Explain. Situation Explanation Messurement Journal Entry Directions Resources Compute the present value of the minimum lease payments. Situation Explanation Measurement Journal Entry Directions Resources Prepare all necessary journal entries for Dexter Labs, Inc. for this lease through January 1, 2013.