On January 1, 2011, Salvatore Company leased several machines from Nola Corporation under a 3-year operating lease agreement. The lease calls for semiannual payments of $15,000 each, payable on June 30 and December 31 of each year. The machines were acquired by Nola at a cost of $90,000 and are expected to have a useful life of 5 years with no expected residual value.
Required:
Prepare the appropriate journal entries for the lessee from the inception of the lease through the end of 2011