American Food Services, Inc., leased a packaging machine from Barton and Barton Corporation. Barton and Barton completed construction of the machine on January 1, 2018. The lease agreement for the $5.7 million (fair value and present value of the lease payments) machine specified four equal payments at the end of each year. The useful life of the machine was expected to be five years with no residual value. Barton and Barton's implicit interest rate was 9%. (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Prepare the journal entry for American Food Services at the beginning of the lease on January 1, 2018. 2. Prepare an amortization schedule for the four-year term of the lease. 3. & 4. Prepare the appropriate entries related to the lease on December 31, 2018 and 2020. Complete this question by entering your answers in the tabs below. Reg 1 Req 2 Req 3 and 4 Prepare the journal entry for American Food Services at the beginning of the lease on January 1, 2018. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in whole dollars and not in millions.) View transaction list Journal entry worksheet 1 Record beginning of the lease for American Food Services. Reg 1 Reg 2 Reg 3 and 4 Prepare the journal entry for American Food Services at the beginning of the lease on January 1, 2018. (If no entry is required for a particular transaction, select "No journal entry required in the first account field. Enter your answers in whole dollars and not in millions.) View transaction list Journal entry worksheet Req 1 Reg 2 Req 3 and 4 Prepare the appropriate entries related to the lease on December 31, 2018 and 2020. (Enter your answers in whole dollars and not millions. Round your intermediate and final answers to nearest whole dollar. If no entry is required for a transaction/event, select " journal entry required" in the first account field.) View transaction list Journal entry worksheet Record the lease payment and interest expense for American Food Services, Note: Enter debits before credits Date General Journal Debit Credit December 31, 2020 No journal entry required Accumulated depreciation Amortization expense Building Record entry Cash View general journal Reg 1 Reg 2 Req 3 and 4 Prepare the appropriate entries related to the lease on December 31, 2018 and 2020. (Enter your answers in whole dollars and not in millions. Round your intermediate and final answers to nearest whole dollar. If no entry is required for a transaction/event, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet 4 Record the amortization of right-of-use asset for American Food Services. Note: Enter debits before credits General Journal Debit Credit Date December 31, 2020 No journal entry required Accumulated depreciation Amortization expense Building Record entry Cash View general Journal
