Current Attempt in Progress Concord Incorporated leases a piece of equipment to Skysong Corporation on January 1, 2020. The lease agreement called for annual rental payments of $5,326 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 $26,700, a book value of $21,700, and both parties expect a residual value of $8,350 at the end of the lease term, though this amount is not guaranteed. Concord set the lease payments with the intent of earning a 5% return, and Skysong is aware of this rate. There is no bargain purchase option, ownership of the lease does not transfer at the end of 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 tble provided.) (a) Your answer is correct. Determine the nature of the lease to both Concord and Skysong. The lease is a/an operating lease to Concord. The lease is a/an operating lease to Skysong. (b) Prepare the lease amortization schedule(s) for Skysong for all 4 years of the lease. (Round answers to O decimal places, e.g. 5,275.) SKYSONG CORPORATION Lease Amortization Schedule Annuity-Due Basis Date Annual Payment Interest on Liability Reduction of Lease Liability Lease Liab 1/1/20 $ $ T $ $ 1/1/20 1/1/21 1/1/22 1/1/23 1 1 25 Lease Expense Schedule Lease Expense (Straight-Line) Interest on Lease Liability Amortization of ROU Asset Carrying ROU Date 1/1/20 $ tA $ $ 12/31/20 I 12/31/21 12/31/22 12/31/23 e Textbook and Media List of Accounts Attempts: unlimited Submit Answer Prepare the journal entries for Skysong for 2020 and 2021. (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.) Date Account Titles and Explanation Debit Credit 1/1/20 I (To record the lease) (To record lease payment) > .. Suppose Skysong incurs initial direct costs of $700 related to the lease. Prepare the journal entries for 2020. (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.) Date Account Titles and Explanation Debit Credit C (To record the lease) (To record lease payment)