1. E21.8 (LO 2, 4) Excel (Lessor Entries; Sales-Type Lease) Crosley Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2020. The lease is for an 8-year period and requires equal annual payments of $35,004 at the beginning of each year. The first payment is received on January 1, 2020. Crosley had purchased the machine during 2019 for $160,000. Collectability of lease payments by Crosley is probable. Crosley set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Crosley at the termination of the lease.

Instructions

a. Compute the amount of the lease receivable.

b. Prepare all necessary journal entries for Crosley for 2020.

c. Suppose the collectability of the lease payments was not probable for Crosley. Prepare all necessary journal entries for the company in 2020.

d. Suppose at the end of the lease term, Crosley receives the asset and determines that it actually has a fair value of $1,000 instead of the anticipated residual value of $0. Record the entry to recognize the receipt of the asset for Crosley at the end of the lease term.

E21.17 (LO 3, 4) (Accounting for an Operating Lease) On January 1, 2020, Nelson Co. leased a building to Wise Inc. The relevant information related to the lease is as follows.

1. The lease arrangement is for 10 years. The building is expected to have a residual value at the end of the lease of $3,500,000 (unguaranteed).

2. The leased building has a cost of $4,000,000 and was purchased for cash on January 1, 2020. 3. The building is depreciated on a straight-line basis. Its estimated economic life is 50 years with no salvage value.

4. Lease payments are $275,000 per year and are made at the beginning of the year. 5. Wise has an incremental borrowing rate of 8%, and the rate implicit in the lease is unknown to Wise. 6. Both the lessor and the lessee are on a calendar-year basis.

Instructions

a. Prepare the journal entries that Nelson should make in 2020.

b. Prepare the journal entries that Wise should make in 2020.

c. If Wise paid $30,000 to a real estate broker on January 1, 2020, as a fee for finding the lessor, what is the initial measurement of the right-of-use asset? Explain.

E21.18 (LO 3, 4) (Accounting for an Operating Lease) On January 1, 2020, a machine was purchased for $900,000 by Young Co. The machine is expected to have an 8-year life with no salvage value. It is to be depreciated on a straight-line basis. The machine was leased to St. Leger Inc. for 3 years on January 1, 2020, with annual rent payments of $150,955 due at the beginning of each year, starting January 1, 2020. The machine is expected to have a residual value at the end of the lease term of $562,500, though this amount is unguaranteed. Instructions

a. How much should Young report as income before income tax on this lease for 2020?

b. Record the journal entries St. Leger would record for 2020 on this lease, assuming its incremental borrowing rate is 6% and the rate implicit in the lease is unknown.

c. Suppose the lease was only for one year (only one payment of the same amount at commencement of the lease), with a renewal option at market rates at the end of the lease, and St. Leger elects to use the short-term lease exception. Record the journal entries St. Leger would record for 2020 on this lease.

I need help on this questions and how to solve Present value on BA11plus calculator. Also will you please explain the steps as well thank you for your help! which part you don't understand?