Exercise 21-4

Windsor Leasing Company signs a lease agreement on January 1, 2017, to lease electronic equipment to Sheridan Company. The term of the noncancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement:

1.		Sheridan Company has the option to purchase the equipment for $16,600 upon termination of the lease.
2.		The equipment has a cost and fair value of $163,000 to Windsor Leasing Company. The useful economic life is 2 years, with a salvage value of $16,600.
3.		Sheridan Company is required to pay $5,200 each year to the lessor for executory costs.
4.		Windsor Leasing Company desires to earn a return of 10% on its investment.
5.		Collectibility of the payments is reasonably predictable, and there are no important uncertainties surrounding the costs yet to be incurred by the lessor.

*PLEASE SHOW ME HOW THE CACULATION WORKED TOO AND FOLLOW THE FORMT TO ANSWER. THANK YOU

Exercise 21-4 Windsor Leasing Company signs a lease agreement on January 1, 2017, to lease electronic equipment to Sheridan Company. The term of the noncancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement: 1. Sheridan Company has the option to purchase the equipment for $ 16,600 upon termination of the lease. 2. The equipment has a cost and fair value of $163,000 to Windsor Leasing Company. The useful economic life is 2 years, with a salvage value of $16,600. 3. Sheridan Company is required to pay $5,200 each year to the lessor for executory costs. 4. Windsor Leasing Company desires to earn a return of 10% on its investment. 5. Collectibility of the payments is reasonably predictable, and there are no important uncertainties surrounding the costs yet to be incurred by the lessor. Click here to view factor tables (a) Prepare the journal entries on the books of Windsor Leasing to reflect the payments received under the lease and to recognize income for the years 2017 and 2018. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter o for the amounts. Round present value factor calculations to 5 decimal places, e.g. 0.527552 and the final answers to 0 decimal places e.g. 5,275.)