Check my work Federated Fabrications leased a tooling machine on January 1, 2018, for a three-year period ending December 31, 2020. The lease agreement specified annual payments of $36,000 beginning with the first payment at the beginning of the lease, and each December 31 through 2019. The company had the option to purchase the machine on December 30, 2020, for $45,000 when its fair value was expected to be $60.000 a sufficient difference that exercise seems reasonably certain. The machine's estimated useful life was six years with no salvage value. Federated was aware that the lessor's implicit rate of return was 10%. (FV of $1. PV of 51. FVA of 51. PVA of $1. FVAD of S1 and PVAD of S1) (Use appropriate factor(s) from the tables provided.) " Required: 1. Calculate the amount Federated should record as a right-of-use asset and lease liability for this finance lease. 2. Prepare an amortization schedule that describes the patter of interest expense for Federated over the lease term. 3. Prepare the appropriate entries for Federated from the beginning of the lease through the end of the lease term. 19 Complete this question by entering your answers in the tabs Below. Required 1 Required 2 Required 3 Calculate the amount Federated should record as a right-of-use asset and lease liability for this finance lease. (Round your intermediate and final answer to the nearest whole dollar amount.) Right-of-use asset and lease ability RE Required 2 > Federated Fabrications leased a tooling machine on January 1 2018, for a three-year period ending December 31, 2020. The lease agreement specified annual payments of $36.000 beginning with the first payment at the beginning of the lease, and each December 31 through 2019. The company had the option to purchase the machine on December 30, 2020, for $45,000 when its fair value was expected to be $60.000 a sufficient difference that exercise seems reasonably certain. The machine's estimated useful life was six years with no salvage value. Federated was aware that the lessor's implicit rate of return was 10% (EV of $1. PV of $1. EVA of $1. PVA of $1. FVAD of S1 and PVAD of 5) (Use appropriate factor(s) from the tables provided.) Required: 1. Calculate the amount Federated should record as a right-of-use asset and lease liability for this finance lease. 2. Prepare an amortization schedule that describes the pattern of interest expense for Federated over the lease term 3. Prepare the appropriate entries for Federated from the beginning of the lease through the end of the lease term. Complete this question by entering your answers in the tabs below. Required 1 Required Required 3 Prepare an amortization schedule that describes the pattern of interest expense for Federated over the lease term. (Round your intermediate and final answer to the nearest whole dollar amount. Enter all amounts as positive values.) Lease Amortization Schedule Pomment Effective Decrease in Interest Balance Date Outstanding Balance 36.000 36.000 01/01/2018 12/31/2018 12/31/2019 12/31/2020 Total 45,000 117.000 $ (Required 1 Required 3 > 1. Calculate the amount Federated should record as a right-of-use asset and lease liability for this finance lease 2. Prepare an amortization schedule that describes the pattern of interest expense for Federated over the lease term 3. Prepare the appropriate entries for Federated from the beginning of the lease through the end of the lease term. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the appropriate entries for Federated from the beginning of the lease through the end of the lease term. (Round your intermediate and final answers to the nearest whole dollar amount. If no entry is required for a transaction/event, select "No journe entry required in the first account field.) View transaction list View journal entry worksheet General Journal Debit Credit No 1 2 Date January 01, 2018 Right-of-use asset Lease payable 2 2 January 01, 2018 Lease payable Cash 2 3 December 31, 2018 Amortization expense Right-of-use asset December 31, 2018 Interest expense Lease payable Cash December 31, Amortization expense 2019 Right-of-use asset December 31, Interest expense 2019 Lease payable Cash December 31, 2020 Amortization expense Right-of-use asset December 31, Interest expense 2020 Lease payable
