Firm A leased equipment with a list price of $180,000, lease life of 4 years, asset life of 4 years, a salvage value of $0, and a contract interest rate of 8%.

What is the journal entry to record the amortization expense on the leased asset ($180,000 4 = $45,000)?

Select one:

a.

Amortization Expense		45,000
Lease Liability			45,000

b.

Amortization Expense		45,000
Accumulated Amortization			45,000

c.

Interest Expense		45,000
Accumulated Amortization			45,000

d.

Amortization Expense		45,000
Cash			45,000