1) what kind of lease is this for smith? Include what criteria of FASB leasing rules are met.

2) Record the journal entries required for 20X2.

On January 1, 20X2, Smith Corporation leased equipment to Jones Company. The lease is for 8 years. The first payment of $675,000 was made on January 1, 20X2. The equipment cost Smith Corporation $3,600,000 and fair value of the equipment on January 1, 20X2 is $3,962,000. Assume the interest rate for this lease is 10%. Smith also paid $12,000 in initial direct costs on January 1. Required: Be sure to show DR and CR in your journal entries. For Smith Corporation: 1. What kind of lease is this for Smith? Be specific including what criteria of the FASB leasing rules are met. 2. Record the journal entries required for 20X2. Edit View Insert Format Tools Table 12pt Paragraph B J U A QV TV : acer Break M