annual lease payments are $67,083.41
Use the information from part a. Assume that, on the same day the sale occurred, Martinez enters into an agreement to lease the equipment from Tamarisk for 10 years with annual lease payments of $ 67,083.41 at the end of each year, beginning on December 31, 2020. If Martinez has an incremental borrowing rate of 5% and the equipment has an economic useful life of 10 years, record any journal entries necessary for Martinez from the sale and leaseback of computer equipment in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 2 decimal places , eg. 5,275.25. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit 11/20 Leased Asset 518.000 518,000 Lease Liability 2/31/20 67.083 Lease Liability 25.900 Interest Expense 92.983 Cash (a) Your answer is correct On January 1, 2020, Martinez Inc sold computer equipment to Tamarisk Co. The sales price of the equipment was $518,000 and its carrying amount is $412,000. Record any journal entries necessary for Martinez from the sale of the computer equipment in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually) Date Account Titles and Explanation Debit Credit 1/1/20 Cash 518,000 412000 Equipment 106,000 Gainon Disposal of Equipment Use the information from part b. Now, instead of 10 years, the lease term is only 3 years with annual lease payments of 67,083.41 at the beginning of each year. Record any journal entries necessary for Martinez from the sale and leaseback of computer equipment in 2020. (Credit account tities are automatically indented when the amount is entered. Do not Indent manually. Round answers to 2 decimal places, eg. 5,275.25. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit (To record sale of equipment) (To record the lease) (To record the lease) (To record lease payment) Use the information from part a. Assume that, on the same day the sale occurred, Martinez enters into an agreement to lease the equipment from Tamarisk for 10 years with annual lease payments of $ 67,083.41 at the end of each year, beginning on December 31, 2020. If Martinez has an incremental borrowing rate of 5% and the equipment has an economic useful life of 10 years, record any journal entries necessary for Martinez from the sale and leaseback of computer equipment in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 2 decimal places , eg. 5,275.25. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit 11/20 Leased Asset 518.000 518,000 Lease Liability 2/31/20 67.083 Lease Liability 25.900 Interest Expense 92.983 Cash (a) Your answer is correct On January 1, 2020, Martinez Inc sold computer equipment to Tamarisk Co. The sales price of the equipment was $518,000 and its carrying amount is $412,000. Record any journal entries necessary for Martinez from the sale of the computer equipment in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually) Date Account Titles and Explanation Debit Credit 1/1/20 Cash 518,000 412000 Equipment 106,000 Gainon Disposal of Equipment Use the information from part b. Now, instead of 10 years, the lease term is only 3 years with annual lease payments of 67,083.41 at the beginning of each year. Record any journal entries necessary for Martinez from the sale and leaseback of computer equipment in 2020. (Credit account tities are automatically indented when the amount is entered. Do not Indent manually. Round answers to 2 decimal places, eg. 5,275.25. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit (To record sale of equipment) (To record the lease) (To record the lease) (To record lease payment)
