Intermediated Acctg II Week 5

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Exercise 21-8 (Part Level Submission) The following facts pertain to a noncancelable lease agreement between Pharoah Leasing Company and Novak Company, a lessee. Inception date: May 1, 2017 Annual lease payment due at the beginning of each year, beginning with May 1, 2017 Bargain-purchase option price at end of lease term Lease term Economic life of leased equipment Lessor's cost Fair value of asset at May 1, 2017 Lessor's implicit rate Lessee's incremental borrowing rate $19,153.46 $4,300 5 10 $69,000 $84,000 9 9 years years % % The collectibility of the lease payments is reasonably predictable, and there are no important uncertainties surrounding the costs yet to be incurred by the lessor. The lessee assumes responsibility for all executory costs. Click here to view factor tables Don't show me this message again for the assignment (c) Prepare a lease amortization schedule for Novak Company for the 5-year lease term. (Round present value factor calculations to 5 decimal places, e.g. 1.25125 and Round answers to 2 decimal places, e.g. 15.25.) Date 5/1/17 5/1/17 5/1/18 5/1/19 5/1/20 NOVAK COMPANY (Lessee) Lease Amortization Schedule Annual Lease Payment Reduction of Plus Interest on Lease BPO Liability Liability $ $ Lease Liability $ $ 5/1/21 4/30/22 $ $ $