Lease Accounting The following facts are for a non-cancellable lease agreement between Lessor Corporation and Lessee Corporation. Use this information for creating journal entries for Lessee Corporation and input your answers in Moodle. Inception Date July 01,2020 Annual Lease Payment (Due: Beginning of Year, 21,500 Starting July 1, 2020) Bargain purchase option at of Lease Term 3,000 (Certain to be exercised by Lessee) Lease Term 7 years Economic Life of Leased 10 years Equipment Lessor's Cost 98,114 Fair Value of Asset Equal to present value of all future payments. Lessor's implicit rate 8% Lesse's incremental 7% borrowing rate The collectibility of the lease payments is reasonably predictable, and there are no important uncertainties about costs that have not yet been incurred by the lessor. Both companies use ASPE and year end is Dec 31 for both companies. Based on Lease Problem, what will be the amounts recorded in the Balance Sheet on July 01, 2020 by the Lessee? . Obligation Under Lease Choose Asset Under Lease Choose... Options for both: . 122,642 credit 120,892 credit Based on the Lease problem, the Lessee will calculate depreciation based on + years and depreciation expense in 2021 will be 10yrs 12089 7yrs 17520 8yrs 12264 (options) (options) Calculate the Interest Expense recorded by Lessee for 2020 and 2021. Options for both: Interest Expense: 2020 Choose.... 7555 Interest Expense: 2021 Choose... 8091 7019 4046 Which lease criteria is NOT fulfilled for the Lease problem as per ASPE from the Lessee's perspective? Select one: O a. All of the criteria is satisfied o b. Economic life O c. Transfer of ownership O d. Recovery of investment by Lessor (Economic Value) The lessor will most likely classify this as Sales Type Lease. Select one: True O False . a. Lessors' Gross Margin from the lease is -55386 or -24528 or 55386 or 24528 b. Lease Receivable recorded by Lessor is 153500 or 122642 or 150500 or 120892 c. Lessor's Sales Revenue from the lease will be 153500 or 122642 or 150500 or 120892 d. Uneamed Interest Income on July 1, 2020 is . 26812 or 0 or 30858 or 29608 e. Uneamed Interest Income on July 1, 2021 is 26812 or 0 or 30858 or 29608 1. The Lessor will receive the final payment from the Lessee on g. Interest income for year 2026 will be 2528 or 0 or 111 or 1010