CALCULATOR PRINTER VERSION BACK 3. Exercise 21-17 On January 1, 2020, Larkspur Co. leased a building to Crane Inc. The relevant information related to the lease is as follows. 1. The lease arrangement is for 10 years. The building is expected to have a residual value at the end of the lease of $3,900,000 (unguaranteed). 2. The leased building has a cost of $4,400,000 and was purchased for cash on January 1, 2020, The building is depreciated on a straight-line basis. Its estimated economic life is so years with no salvage value 4. Lease payments are $260,000 per year and are made at the beginning of the year, 5. Crane has an incremental borrowing rate of 5%, and the rate implicit in the lease is unknown to Crane. 6. Both the lessor and the lessee are on a calendar-year basis. Click here to view factor tables. (For calculation purposes, use 5 decimal places as deployed in the factor tabte provided) Your swer is partially correct. Try again Prepare the yournal entries that artapur should make in 2020. (CreBit accounts are automatically indented when amount is entered Domofindent manually. Record journal entries in the order presented in the problem.) Date Account Tities and Explanation Debit Credit 1/1/20 Buldings 4400000 Cash 4400000 Cash 260000 Unearned Lease even Ureamed Lens Revenue 260000 Lease Revenue answer is partid Hry again. Prepare the journal entries that Larkspur should make in 2020. (Credit account titles are automatically indented when amount is entered. Don in the order presented in the problem.) Account Titles and Explanation Debit 1/1/20 Buildings 4400000 Date Credit Cash 4400000 (To record cost of the building) 1/1/20 Cash 260000 260000 Unearned Lease Reveni (To record receipt of lease payment) 12/31/20 Unearned Lease Revenue 260000 260000 260000 Lease Revenue (To record the recognition of the revenue each period) 12/31/20 Depreciation Expense 88000 Leased Buildings (To record depreciation expense on the leased asset) 88000 Your answer is partially correct. Try again Prepare the journal entries that Crane should make in 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to o decimal places, e.g. 5,275. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit 1/1/20 Right-of-Use Asset 2108033 Lease Liability (To record the base) 2108033 1/1/20 Lease Liability 200000 Cash To record lease payment) 260000 12/31/20 Interest Expense 105402 Lease Liability 154598 Right-of-Use Asset 260000 SHOW LIST OF ACCOUNTS Your answer is correct. If Crane paid $30,000 to a real estate broker on January 1, 2020, as a fee for finding the lessor, what is the initial measurement of the right-of-use asset? Right-of-use asset 2138033 Click If you would like to show Work for this question: Open Show Work