all info as probided

Problem 1 Torino Industries manufactures high end tractors and other farm equipment. Ambassador Farms is interested in purchasing five new tractors for its operations and has entered into a lease agreement with Ambassador under the following conditions. January 1,2014 Eight (8) Years 12 Years Lease Start Date Term of Lease Economic Life Tractor Fair Market Value Tractor Cost of Building Tractor Lessor Implicit Interest Rate Lessee Incremental Borrowing Rate Residual Value S350,000 each tractor S263,000 each tractor 10% 8% S15,000 each tractor Guaranteed by a Third Part Designee Required: Prepare the entries on the books of the lessor (Torino) and the lessee (Ambassador) for the period January 1, 2014 through January 1, 2016. Year end accruals may be ignored