Exercise 15-6 (Algo) Finance lease; lessee (LO15-2] Manufacturers Southern leased high-tech electronic equipment from Edison Leasing on January 1, 2021. Edison purchased the equipment from International Machines at a cost of $112,446. (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.) Related Information: Lease term 2 years (8 quarterly periods ) Quarterly rental payments $15,300 at the beginning of each period Economic life of asset 2 years Fair value of asset $112,446 Implicit interest rate (Also lessee's incremental borrowing rate) 10% Required: Prepare a lease amortization schedule and appropriate entries for Manufacturers Southern from the beginning of the lease through January 1, 2022. Amortization of the right-of-use asset is recorded at the end of each fiscal year (December 31) on a straight-line basis. Complete this question by entering your answers in the tabs below. Amort Schedule General Journal Prepare a lease amortization schedule for the term of the lease for Manufacturers Southern. (Round your intermediate calculations and final answers to the nearest whole dollar) Payment Date Lease Payments Effective Interest Decrease in Balance Lease Balance 01/01/2021 04/01/2021 07/01/2021 10/01/2021 01/01/2022 04/01/2022 07/01/2022 10/01/2022 Total $ 0 $ 0 $ 0 Journal entry worksheet Record the beginning of the lease for Manufacturers Southern. Note: Enter debits before credits. Debit Credit Date General Journal January 01, 2021 Right-of-use asset Lease payable Record entry Clear entry View general journal Journal entry worksheet Record lease payment. Note: Enter debits before credits. Debit Credit Date General Journal January 01, 2021 Lease payable Record entry Clear entry View general journal Journal entry worksheet Record lease payment. Note: Enter debits before credits. Debit Credit Date April 01, 2021 General Journal Lease payable Record entry Clear entry View general journal Journal entry worksheet Record lease payment. Note: Enter debits before credits. Debit Credit Date July 01, 2021 General Journal Lease payable Record entry Clear entry View general journal Journal entry worksheet Record lease payment. Note: Enter debits before credits. Debit Credit Date General Journal October 01, 2021 Lease payable Record entry Clear entry View general journal Journal entry worksheet Record accrued interest. Note: Enter debits before credits. Debit Credit Date General Journal December 31, 2021 Interest expense Interest payable Record entry Clear entry View general journal Journal entry worksheet Record amortization of the right-of-use asset for Manufacturers Southern. Note: Enter debits before credits. General Journal Debit Credit Date December 31, 2021 Record entry Clear entry View general journal Journal entry worksheet Record lease payment. Note: Enter debits before credits. General Journal Debit Credit Date January 01, 2022 Record entry Clear entry View general journal
