Check my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate complet On January 1, 2021, Lesco Leasing leased equipment to Quality Services under a finance/sales-type lease designed to earn NRC a 12% rate of return for providing long-term financing. The lease agreement specified: (FV of $1. PV of $1. FVA of $1. PVA of $1. FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) a. Ten annual payments of $66,000 beginning January 1, 2021, the beginning of the lease and each December 31 thereafter through 2029. b. The estimated useful life of the leased equipment is 10 years with no residual value. Its cost to Lesco was $386,023. c. The lease qualifies as a finance lease/sales-type lease, d. A 10-year service agreement with Quality Maintenance Company was negotiated to provide maintenance of the equipment as required. Payments of $5,000 per year are specified, beginning January 1, 2021. Lesco was to pay this cost as incurred, but lease payments reflect this expenditure. Also included in the $66,000 payments is an insurance premium of $4,000 providing coverage for the equipment Required: 1. Prepare the appropriate entries for both the lessee and lessor related to the lease on January 1, 2021 2. Prepare the appropriate entries for both the lessee and lessor related to the lease on December 31, 2021. Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the appropriate entries for both the lessee and lessor related to the lease on January 1, 2021. (if no entry is required for a transaction/event, select "No journal entry required" in the first account field Round your intermediate and final answers ko nearest whole dollar:). No Date General Journal Debit Credit W Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the appropriate entries for both the lessee and lessor related to the lease on January 1, 2021. (If no entry is required For a transaction/event, select "No journal entry required in the first account field. Round your intermediate and final answers to nearest whole dollar.) No Date General Journal Debit Credit 1 January 01, 2021 Lease receivable Lease payable 386,023 386.023 2 January 01, 2021 Lease payable Prepaid maintenance expense Cash 61,000 5,000 66,000 3 January 01, 2021 Lease receivable Equipment 386,023 386,023 4 > 66,000 January 01, 2021 Cash Maintenance fee payable Lease receivable 5,000 61.000 Resultad Required 2 > W Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the appropriate entries for both the lessee and lessor related to the lease on December 31, 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your intermediate and final answers to nearest whole dollar.) No Dato General Journal Debit Credit December 31, 202 Lease payable 22,597 X Interest expense 38,403 X Maintenance expense X 5,000 Cash 66,000 1 2 38,602 December 31, 202 Depreciation expense Accumulated depreciation 38,602 3 66,000 December 31, 202 Cash Interest revenue Lease receivable Maintenance expense 38,403 22,597 X 5,000
