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Lessee enters into a five-year lease of office space on January 1, and concludes that the agreement is an operating lease. Lessee pays initial direct

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Lessee enters into a five-year lease of office space on January 1, and concludes that the agreement is an operating lease. Lessee pays initial direct costs of $5,000. The agreement provides the following: Complete the following table to show the impact on each year of Lessee's income statement and balance sheet. Prepare the journal entries for the Lessee at the commencement of the lease and at the end of year 1

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