Gumbie Leasing Company leased several microbiological incubators to Mistoffelees Pharmaceutical Research Corporation under a finance sales type lease arrangement The lease was structured to earn a 9 rate of return for Gumbie The lease contract specified 5 annual payments of $74,500 Mistoffelees was required to make the first payment on January 3, 2022, the day the lease was signed The rest of the payments were due each December 31 after that through 2025 Gumbie purchased a comprehensive hazard liability insurance policy from AllGeicoFarm Insurance for the incubators The $4,000 annual insurance premium was included in Mistoffolees $74,500 lease payments Gumbie contracted with Skimbleshanks Maintenance Company to provide regular maintenance and on call repair services for the incubators The maintenance contract required annual payments of $2,500 beginning January 3, 2022 The cost of annual maintenance was included in the lease payments from Mistoffelees described above The lease qualifies as a finance sales type lease The estimated useful life of the equipment is 4 years, with no residual value Mistoffolees paid legal fees and brokers commissions totaling $25,000 in connection with the lease The costs would not have been incurred had the lease agreement not occurred Gumbie is a large company with a fully staffed leasing department they incurred no additional costs specific to this lease Is the hazard liability insurance cost a component of the lease Explain Is the cost of Skimbleshanks service a component of the lease Explain Assume that this is not a sales type lease with profit for Gumbie What was the total cost of the incubators to Gumbie Show the journal entry or entries that Mistoffolees made at the inception of the lease Show the journal entry or entries that Mistoffolees made at December 31, 2022 Show the journal entry or entries that Gumbie made at the inception of the lease Show the journal entry or entries that Gumbie made at December 31, 2022

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Gumbie Leasing Company leased several microbiological incubators to Mistoffelees Pharmaceutical Research Corporation under a finance/sales-type lease arrangement. The lease was structured to earn a 9%

Gumbie Leasing Company leased several microbiological incubators to Mistoffelees Pharmaceutical Research Corporation under a finance/sales-type lease arrangement. The lease was structured to earn a 9% rate of return for Gumbie. The lease contract specified:

5 annual payments of $74,500. Mistoffelees was required to make the first payment on January 3, 2022, the day the lease was signed. The rest of the payments were due each December 31 after that through 2025.
Gumbie purchased a comprehensive hazard/liability insurance policy from AllGeicoFarm Insurance for the incubators. The $4,000 annual insurance premium was included in Mistoffolees $74,500 lease payments.
Gumbie contracted with Skimbleshanks Maintenance Company to provide regular maintenance and on-call repair services for the incubators. The maintenance contract required annual payments of $2,500 beginning January 3, 2022. The cost of annual maintenance was included in the lease payments from Mistoffelees described above.
The lease qualifies as a finance/sales-type lease.
The estimated useful life of the equipment is 4 years, with no residual value.
Mistoffolees paid legal fees and brokers commissions totaling $25,000 in connection with the lease. The costs would not have been incurred had the lease agreement not occurred. Gumbie is a large company with a fully staffed leasing department; they incurred no additional costs specific to this lease.