DELL 1. Jan Way has the option to purchase the equent for $16.000 pon of the a not reasonably certain that Jan Vay will ecoton, 2. The equipment econn life is 3. Castle Lensing desires to earn a retum 4. Colectiidity of the payments by Castle Leasing Instructions value of $160.000 to C Leang The $16.000 probati a. Prepare the journal entries on the books of Castle Leasing to reflect the payments received under the lease and to recognize income for the years 2010 and 2020 b. Assuming that Jan Way exercises its option to purchase the equipment on December 31, 2000 prepare the journal entry to record the sale on Castle Lessing's books E21.7 (L02. 3) (Type of Lease: Amortization Schedule) Mecinaki Leaning as a new machine to Sharrer SA. The machine has a cost of 670,000 and fair value of 695.000 Under the 3-year, con cancelable contract, Sharrer will receive title to the machine at the end of the ease. The machine has a 3-year useful life and no residual value. The lease was signed on January 1, 2019. Macinski expects to eam an 8% rebum on its investment, and this implicit rate in known by Shamer. The annual rentals are payable on each December 31, beginning December 31, 2018 Instructions a. Discuss the nature of the lease arrangement and the accounting method that each party to the lease should apply. b. Prepare an amortization schedule that would be suitable for both the lessor and the lessee and that covers all the years involved c. Prepare the joumal entry at commencement of the lease for Macinski d. Prepare the journal entry at commencement of the lease for Shamer. e. Prepare the journal entry at commencement of the lease for Sharrer, assuming (1) Shamer does not know Macinski's implicit rate (Shamer's incremental bomowing rate is 9%), and (2) Shamer incurs initial directs costs of 10,000 E21.8 (LO2, 3) (Lessor Entries; Sales-Type Lease) Crosley Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2019. The lease is for an 8-year period and requires equal annual payments of $35,004 at the beginning of each year. The first payment is received on January 1, 2019. Crosley had purchased the machine during 2018 for $160,000. Collectibility of lear payments by Crosley is probable. Crosley set the annual rental to ensure a 6% rate of retum. The machine has an economic life of 10 years with no residual value and reverts to Crosley at the termination of the lease Instructions a. Compute the amount of the lease receivable. b. Prepare all necessary journal entries for Crosley for 2019. c. Suppose the collectibility of the lease payments was not probable for Crosley, Prepare all necessary journal entries for the company in 2019 d. Suppose at the end of the lease term, Crosley receives the asset and determines that it actua has a fair value of $1.000 instead of the anticipated residual value of $0. Record the entry to recognize the receipt of the asset for Crosley at the end of the lease term 21.9 (LO2, 4) (Lessee Entries; Initial Direct Costs) Use the information for Crosley Company E21.8. Assume that Dexter Corporation does not know the rate implicit in the lease used by Cr and Dexter's incremental borrowing rate is 8%, In addition, assume that Dexter incurs initial dir costs of $15,000 estructions a. Compute the amount of the lease liability and right-of-use asset for Dexter. b. Prepare all necessary journal entries for Dexter for 2019. Entries with Bargain Purchase Option) The following facts pertain to Jorge (amounts