ACCT 302 Lease Problem Hernandez Corp. leases equipment from Turner Corp. under the following lease terms: 1. The lease term is 10 years and is non-cancelable. 2. Equal rental payments of 30,300 are due at the beginning of each year starting January 1, 2020. 3. The fair value of the equipment at the commencement of the lease is $242,741. 4. The cost of the equipment on Turner's books is $180,000. 5. The estimated economic life is 15 years. 6. The expected residual value is $45,000. 7. Hernandez has guaranteed a residual value of $50,000. 8. There are no renewal options. 9. The equipment reverts to Turner at the end of the lease. 10. The equipment does not have specialized use. 11. Hernandez incremental borrowing rate is 8%. 12. The implicit rate is 8%. 13. Hernandez depreciates similar equipment on a straight-line basis. 14. Collectibility of payments is probable. Required: 1. Identify the type of lease. 2. Prepare the journal entries for the lessee and lessor for 2020 and 2021. 3. What would have been the initial amount of the lease liability if: a. The residual value was not guaranteed? 4. What would have been the initial amount of the lease receivable if: a. The residual was not guaranteed? 41633