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0.85/ Question 1 View Policies Show Attempt History Current Attempt in Progress Your answer is partially correct. On January 1, 2020, Sheffield Animation sold a truck to Peete Finance for $50,000 and immediately leased it back. The truck was carried on Sheffield's books at $45,000. The term of the lease is 3 years, there is no bargain purchase option, and title does not transfer to Sheffield at lease-end. The lease requires three equal rental payments of $15,200 at the end of each year (first payment on January 1, 2021). The appropriate rate of interest is 6%, the truck has a useful life of 5 years, and the residual value at the end of the lease term is expected to be $14,000, none of which is guaranteed. Prepare Sheffield's 2020 journal entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to decimal places, eg. 5,265. Record journal entries in the order presented in the problem.) Click here to view factor tables. Date Account Titles and Explanation Debit Credit 1/1/20 Cash 50000 45000 Trucks 5000 Gain on Disposal of Plant Assets (To record sale of truck) 50000 1/1/20 Right-of-Use Asset 50000 Lease Liability W wplus.com/courses/36120/assignments/4318478?module_item_id=13627077 purposes, use 5 decimal places as displayed in the factor table provided and round final answers to decimal places, eg. 5,265. Record journal entries in the order presented in the problem.) Click here to view factor tables. Date Account Titles and Explanation Debit Credit 1/1/20 Cash 50000 Trucks 45000 Gain on Disposal of Plant Assets 5000 (To record sale of truck) 1/1/20 Right-of-Use Asset 50000 50000 Lease Liability (To record lease liability) Lease Expense 12/31/20 15200 12200 Lease Liability Right-of-Use Asset 3000 e Textbook and Media List of Accounts Save for Later Attempts: 1 of 5 used Submit Answer 8 0.85/ Question 1 View Policies Show Attempt History Current Attempt in Progress Your answer is partially correct. On January 1, 2020, Sheffield Animation sold a truck to Peete Finance for $50,000 and immediately leased it back. The truck was carried on Sheffield's books at $45,000. The term of the lease is 3 years, there is no bargain purchase option, and title does not transfer to Sheffield at lease-end. The lease requires three equal rental payments of $15,200 at the end of each year (first payment on January 1, 2021). The appropriate rate of interest is 6%, the truck has a useful life of 5 years, and the residual value at the end of the lease term is expected to be $14,000, none of which is guaranteed. Prepare Sheffield's 2020 journal entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to decimal places, eg. 5,265. Record journal entries in the order presented in the problem.) Click here to view factor tables. Date Account Titles and Explanation Debit Credit 1/1/20 Cash 50000 45000 Trucks 5000 Gain on Disposal of Plant Assets (To record sale of truck) 50000 1/1/20 Right-of-Use Asset 50000 Lease Liability W wplus.com/courses/36120/assignments/4318478?module_item_id=13627077 purposes, use 5 decimal places as displayed in the factor table provided and round final answers to decimal places, eg. 5,265. Record journal entries in the order presented in the problem.) Click here to view factor tables. Date Account Titles and Explanation Debit Credit 1/1/20 Cash 50000 Trucks 45000 Gain on Disposal of Plant Assets 5000 (To record sale of truck) 1/1/20 Right-of-Use Asset 50000 50000 Lease Liability (To record lease liability) Lease Expense 12/31/20 15200 12200 Lease Liability Right-of-Use Asset 3000 e Textbook and Media List of Accounts Save for Later Attempts: 1 of 5 used Submit Answer 8
