The following facts pertain to a non-cancelable lease agreement between Lennox Leasing Company and Gill Company, a

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The following facts pertain to a non-cancelable lease agreement between Lennox Leasing Company and Gill Company, a lessee.

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The lessee assumes responsibility for all executory costs.
Instructions (Round all numbers to the nearest cent.)

(a) Discuss the nature of this lease to Gill Company.

(b) Discuss the nature of this lease to Lennox Company

(c) Prepare a lease amortization schedule for Gill Company for the 5-year lease term.

(d) Prepare the journal entries on the lessee's books to reflect the signing of the lease agreement and to record the payments and expenses related to this lease for the years 2015 and 2016. Gill’s annual

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Intermediate Accounting IFRS Edition

ISBN: 9781118443965

2nd Edition

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield

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