Exercise 15-29 (Algo) Finance lease; purchase options; lessee [LO15-2, 15-6] Federated Fabrications leased a tooling machine on January 1, 2024, for a three-year period ending December 31, 2026. - The lease agreement specified annual payments of $33,000 beginning with the first payment at the beginning of the lease, and each December 31 through 2025 . - The company had the option to purchase the machine on December 30,2026 , for $42,000 when its fair value was expected to be $57,000, 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%. Note: Use tables, Excel, or a financial calculator. (FV of \$1, PV of \$1, FVA of \$1, PVA of \$1. FVAD of \$1 and PVAD of \$1) Required: 1. Caiculate 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. Calculate the amount Federated should record as a right-of-use asset and lease liability for this finance lease. Note: Round your intermediate and final answer to the nearest whole dollar amount: Exercise 15-29 (Algo) Finance lease; purchase options; lessee [LO15-2, 15-6] Federated Fabrications leased a tooling machine on January 1, 2024, for a three-year period ending December 31,2026. - The lease agreement specified annual payments of $33,000 beginning with the first payment at the beginning of the lease, and each December 31 through 2025. - The company had the option to purchase the machine on December 30,2026 , for $42,000 when its fair value was expected to be $57,000, 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%. Note: Use tables, Excel, or a financial calculator. (FV of \$1, PV of \$1, FVA of \$1, PVA of \$1, FVAD of \$1 and PVAD of \$1) 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. Prepare an amortization schedule that describes the pattern of interest expense for Federated over the lease term. Note: Round your intermediate and final answers to the nearest whole dollar amount. Enter all amounts as positive values. Exercise 15-29 (Algo) Finance lease; purchase options; lessee [LO15-2, 15-6] Federated Fabrications leased a tooling machine on January 1, 2024, for a three-year perlod ending December 31,2026. - The lease agreement specified annual payments of $33,000 beginning with the first payment at the beginning of the lease, and The company had the option to purchase the machine on December 30,2026 , for $42,000 when its falir value was expected to be $57,000, 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%. Note: Use tables, Excel, or a financial calculator. (EV of \$1, PV of \$1, FVA of S1. PVA of \$1. FVAD or S1 and PVAD or Si1) 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. Prepare the appropriate entries for Federated from the beginning of the lease through the end of the lease term. Note: Round your intermediate and final answers to the nearest whole dollar amount, If no entry is required for a transactionvevent, select "No journal entry required" in the first account field. Journal entry worksheet
