Bramble Inc. manufactures an X-ray machine with an estimated life of 12 years and leases it to Chambers Medical Center for a period of 10 years. The normal selling price of the machine is $467,913, and its guaranteed residual value at the end of the non-cancelable lease term is estimated to be $15,700. The hospital will pay rents of $61,200 at the beginning of each year. Bramble incurred costs of $255,000 in manufacturing the machine and $14,500 in legal fees directly related to the signing of the lease. Bramble has determined that the collectibility of the lease payments is probable and that the implicit interest rate is 7%.

Compute the amount of each of the following items.

1. Lease receivable at commencement of the lease

2. Sales Price

3. Cost of Sales

Prepare a 10-year lease amortization schedule for Bramble, the lessor.

Prepare all of the lessors journal entries for the first year.