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Bramble AG leases a piece of equipment to Marin SA on January 1, 2022. The lease agreement called for annual rental payments of 6,516 at
Bramble AG leases a piece of equipment to Marin SA on January 1, 2022. The lease agreement called for annual rental payments of 6,516 at the beginning of each year of the 4-year lease. The equipment has an economic useful life of 6 years, a fair value of 31,500, and a book value of 26,500. Both parties expect a residual value of 8,800 at the end of the lease term, though this amount is not guaranteed. Bramble set the lease payments with the intent of earning a 5% return, and Marin is aware of this rate. There is no bargain purchase option, ownership of the lease does not transfer at the ensof the lease term, and the asset is not of a specialized nature. Click here to view factor tables. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) repare the lease amortization schedule(s) for Marin for all 4 years of the lease. (Round answers to 0 decimal places, eg. 5,275. Prepare the lease amortization schedule(s) for Marin for all 4 years of the lease. (Round answers to 0 decimal places, eg. 5,275.) Prepare the journal entries for Marin for 2022 and 2023. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Suppose Marin incurs initial direct costs of 750 related to the lease. Prepare the journal entries for 2022. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)
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