IE 15-2 (Static) Based on Exercise 15-5 Sales-type lease; lessor; balance sheet and income statement effects [LO15-3] On June 30 of the current year, Clark, Incorporated leased warehouse equipment from Woodward, incorporated. The lease agreement calls for Clark to make semiannual lease payments of $600,000 over a 2 -year lease term (also the asset's useful life). payable each June 30 and December 31 , with the first payment on June 30 of the current year. Clark's incremental borrowing rate is 10%, the same rate Woodward used to calculate lease payment amounts. Woodward manufactured the equipment at a cost of $1,900,000. Required: 1. Determine the price at which Woodward is 'selling' the equipment (present value of the lease payments) using Excels PV function. 2. Prepare the journal entry to record the sale by Woodward incorporated on June 30 of the current year: 3. Prepare an amortization schedule for the 2-year term of the lease. 4. Prepare the journal entry to record the first lease payment received by Woodward incorporated on June 30 of the current year. 5. Prepare the journal entry to record the second lease payment recelved by Woodward incorporated on December 31 of the current year. 6. Indicate the amounts related to the lease reported on the year-end balance sheets and income statements. (Ignore taxes) Novigation: 1. Use the Open Excel in New Tab button to launch this question. 2. When finished in Excel, use the Sove ond Return to Assignment button in the lower right to leturn to Connect. On June 30, 2023, Clark, Incorporated leased warehouse equipment from Woodward, Incorporated. The lease agreement calls for Clark to make semiannual lease payments of $600,000 over a 2 -vear lease term (also the asset's useful life), payable each June 30 and December 31 , with the first pavment on June 30,2023 . Clark's incremental borrowing rate is 10%, the same rate Woodward used to calculate lease payment amounts. Woodward manufactured the equipment at a cost of $1,900,000. 15 16 1. Determine the price at which Woodward is 'selling' the equipment (present value of the 17 lease payments) using Excel's PV function. 36 4. Prepare the journal entry to record the first lease payment received by Woodward Incorporated on June 30,2023. \begin{tabular}{|l|l|l|l|} \hline 37 & \multicolumn{2}{|c|}{ Date } & Debit \\ \hline 38 & June 30,2023 & & \\ \hline 39 & & & \\ \hline 40 & & & \\ \hline \end{tabular} 41 42 5. Prepare the journal entry to record the second lease payment received by Woodward incorporated on December 31,2023. 47 48 6. Indicate the amounts related to the lease reported on the year-end balance sheets and income statements. (Ignore taxes) \begin{tabular}{|l||c|c|c|c|} \hline 59 & Date & Lalance Sheet & \multicolumn{2}{|c|}{ Income Statement Amounts } \\ \hline 51 & Lease Receivable & Interest Revenue & Selling profit & Totaleffectonincome(pretax) \\ \hline 52 & December 31,2023 & & $0 \\ \hline \end{tabular}