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Ivanhoe Corporation, which uses ASPE, enters into a 7-year lease of equipment on September 13, 2017 that requires 7 annual payments of $30,000 each, beginning
Ivanhoe Corporation, which uses ASPE, enters into a 7-year lease of equipment on September 13, 2017 that requires 7 annual payments of $30,000 each, beginning September 13, 2017. In addition, Ivanhoe guarantees the lessor a residual value of $19,200 at lease end. The equipment has a useful life of 7 years. Assume that for Swifty Corporation, the lessor, collectibility is reasonably predictable, there are no important uncertainties concerning costs, and the equipment's carrying amount is $133,000. (Use tables below, a financial calculator, or Excel functions.) lick he view the f Prepare Swifty's September 13, 2017 journal entries assuming an interest rate of 12%. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round factor values to 5 decimal places, e.g. 1.25124 and final answers to o decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit Sept. 13 (To record inception of lease) Sept. 13 (To record cost of equipment sold) Sept. 13 To record receipt of first lease payment)
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