LESSEE

LESSOR

On December 31, 2021, Rhone-Metro Industries leased equipment to Western Soya Co. for a four-year period ending December 31, 2025, at which time possession of the leased asset will revert back to Rhone-Metro. The equipment cost Rhone-Metro $610,523 and has an expected useful life of six years. Its normal sales price is $610,523. The lessee-guaranteed residual value at December 31, 2025, is $26,000. Equal payments under the lease are $170,000 and are due on December 31 of each year. The first payment was made on December 31, 2021. Western Soya's incremental borrowing rate is 13%. Western Soya knows the interest rate implicit in the lease payments is 10%. Both companies use straight-line depreciation. Use (FV of $1, PV of $1, FVA of $1. PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: Prepare all appropriate entries for Western Soya on December 31, 2022 (the second lease payment and amortization). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to nearest whole dollar.) View transaction list Journal entry worksheet Record cash payment. Note: Enter debits before credits. General Journal Debit Credit Date December 31, 2022 Record entry Clear entry View general journal Prepare all appropriate entries for Western Soya on December 31, 2022 (the second lease payment and amortization). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to nearest whole dollar.) View transaction list Journal entry worksheet Record amortization expense. Note: Enter debits before credits. General Journal Debit Credit Date December 31, 2022 Record entry Clear entry View general journal Prepare all appropriate entries for Western Soya on December 31, 2022 (the second lease payment and amortization). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet 1 Record cash received. Note: Enter debits before credits. General Journal Debit Credit Date December 31, 2022 Record entry Clear entry View general journal TABLE 1 Future Value of $1 FV = $1(1 + i)" ni 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 5.5% 6.0% 7.0% 8.0% 0.0% 0.0% 11.0% 12.0% 20.0% 1 2 3 4 5 1.01000 1.02010 1.03030 1.04060 1.05101 1.01500 1.03022 1.04568 1.06136 1.07728 1.02000 1.04040 1.06121 1.08243 1.10408 1.02500 1.05063 1.07689 1.10381 1.13141 1.03000 1.06090 1.09273 1.12551 1.15927 1.03500 1.07123 1.10872 1.04000 1.08160 1.12486 1.04500 1.09203 1.14117 1.05000 1.10250 1.15763 1.05500 1.11303 1.17424 1.06000 1.07000 1.12360 1.14490 1.191021.22504 1.08000 1.16640 1.25971 1.09000 1.10000 1.18810 1.21000 1.295031.33100 1.11000 1.23210 1.36763 1.12000 1.25440 1.40493 1.20000 1.44000 1.72800 2.07360 2.48832 1.14752 1.18769 1.16986 1.21665 1.19252 1.24618 1.21551 1.27628 1.23882 1.30696 1.26248 1.33823 1.31080 1.40255 1.36049 1.46933 1.411581.46410 1.53862 1.61051 1.51807 1.68506 1.57352 1.76234 2.98598 6 7 8 9 10 1.06152 1.09344 1.07214 1.10984 1.08286 1.12649 1.09369 1.14339 1.10462 1.16054 1.12616 1.15969 1.19405 1.22926 1.26532 1.30226 1.34010 1.37884 1.41852 1.50073 1.14869 1.18869 1.22987 1.27228 1.31593 1.36086 1.40710 1.45468 1.50363 1.60578 1.17166 1.21840 1.26677 1.31681 1.36857 1.42210 1.47746 1.53469 1.593851.71819 1.19509 1.24886 1.30477 1.36290 1.42331 1.48610 1.55133 1.619091.68948 1.83846 1.21899 1.28008 1.34392 1.41060 1.48024 1.55297 1.62889 1.70814 1.79085 196715 1.58687 1.71382 1.85093 1.99900 2.15892 1.67710 1.82804 1.99256 2.17189 2.36736 1.77156 1.94872 2.14359 2.35795 2.59374 1.87041 2.07616 2.30454 2.55804 2.83942 1.97382 2.21068 2.47596 2.77308 3.10585 3.58318 4.29982 5.15978 6.19174 7.43008 11 12 13 14 15 1.11567 1.17795 1.24337 1.31209 1.38423 1.12683 1.19562 1.26824 1.34489 1.42576 1.13809 1.21355 1.29361 1.37851 1.46853 1.14947 1.23176 1.31948 1.41297 1.51259 1.16097 125023 1.34587 1.44830 1.55797 1.45997 1.53945 1.51107 1.60103 1.56396 1.66507 1.61869 1.73168 1.67535 1.80094 1.62285 1.71034 1.802091.89830 2.10485 2.33164 1.69588 1.79586 1.90121 2.01220 2.25219 2.51817 1.77220 1.88565 2.00577 2.13293 2.40985 2.71962 1.85194 1.97993 2.11609 2.260902.57853 2.93719 1.93528 2.07893 2.23248 2.39656 2.759033.17217 2.58043 2.81266 3.06580 3.34173 3.64248 2.85312 3.13843 3.45227 3.79750 4.17725 3.15176 3.47855 3.49845 3.89598 3.88328 4.36349 4.31044 4.88711 4.784595.47357 8.91610 10.69932 12.83918 15.40702 16 17 1.17258 1.18430 1.26899 1.28802 1.37279 1.40024 1.48451 1.52162 1.60471 1.65285 1.73399 1.79468 1.87298 1.94790 2.02237 2.11338 2.18287 2.35526 2.29202 2.48480 2.54035 2.69277 2.95216 3.15882 3.42594 3.97031 3.700024.32763 4.59497 5.05447 5.31089 6.13039 5.895096.86604 18 19 20 1.19615 1.30734 1.20811 1.32695 1.22019 1.34686 1.42825 1.55966 1.45681 1.59865 1.48595 1.63862 1.70243 1.75351 1.80611 1.85749 2.02582 2.20848 2.40662 2.62147 1.92250 2.10685 2.30786 2.52695 2.76565 1.98979 2.19112 2.41171 2.65330 2.91776 2.85434 3.02560 3.20714 3.379933.99602 3.61653 4.31570 3.86968 4.66096 4.71712 5.14166 5.60441 5.55992 6.11591 6.72750 6.54355 7.26334 8.06231 7.68997 8.61276 9.64629 18.48843 22.18611 26.62333 31.94800 38.33760 21 25 30 40 1.23239 1.36706 1.28243 1.45095 1.34785 1.56308 1.48886 1.81402 1.51567 1.67958 1.86029 2.05943 2.27877 2.52024 2.78596 3.07823 3.39956 4.14056 5.03383 6.10881 1.64061 1.85394 2.09378 2.36324 2.66584 3.00543 3.38635 3.813394.29187 5.42743 6.84848 8.62308 1.81136 2.09757 2.42726 2.806793.24340 3.74532 4.32194 4.98395 5.743497.61226 10.06266 13.26768 2.20804 2.68506 3.26204 3.95926 4.80102 5.81636 7.03999 8.51331 10.28572 14.97446 21.72452 31.40942 7.40025 8.94917 10.80385 10.83471 13.58546 17.00006 17.44940 22.89230 29.95992 45.25926 65.00087 93.05097 46.00512 9 5 39622 23737631 1469.77160 TABLE 2 Present Value of $1 $1 (1+i)" wi 1.0% 1.5% 1 0.99010 0.98522 2 0.98030 0.97066 3 0.97059 0.95632 4 0.96098 0.94218 5 0.95147 0.92826 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% 5.0% 5,5% 6.0% 7.0% 8.0% 9.0% 0.98039 0.97561 0.97087 0.96618 0.96154 0.95694 0.95238 0.94787 0.94340 0.93458 0.92593 0.91743 0.96117 0.95181 0.94260 0.93351 0.92456 0.91573 0.90703 0.89845 0.89000 0.87344 0.85734 0.84168 0.94232 0.92860 0.91514 0.90194 0.88900 0.87630 0.86384 0.85161 0.83962 0.81630 0.79383 0.77218 0.92385 0.90595 0.88849 0.87144 0.85480 0.83856 0.82270 0.80722 0.79209 0.76290 0.73503 0.70843 0.90573 0.88385 0.86261 0.84197 0.82193 0.80245 0.78353 0.76513 0.74726 0.71299 0.68058 0.64993 10.0% 11.0% 12.0% 20.0% 0.90909 0.90090 0.89286 0.83333 0.82645 0.81162 0.79719 0.69444 0.75131 0.73119 0.71178 0.57870 0.68301 0.65873 0.63552 0.48225 0.62092 0.59345 0.56743 0.40188 6 0.94205 0.91454 0.88797 0.86230 0.83748 0.81350 0.79031 0.76790 0.74622 0.72525 0.70496 0.66634 0.63017 0.59627 0.56447 0.53464 0.50663 0.33490 7 0.93272 0.90103 0.87056 0.84127 0.81309 0.78599 0.75992 0.73483 0.71068 0.68744 0.66506 0.62275 0.58349 0.54703 0.51316 0.48166 0.45235 0.27908 8 0.92348 0.88771 0.85349 0.82075 0.78941 0.75941 0.73069 0.70319 0.67684 0.65160 0.62741 0.58201 0.54027 0.50187 0.46651 0.43393 0.40388 0.23257 9 0.91434 0.87459 0.83676 0.80073 0.76642 0.73373 0.70259 0.67290 0.64461 0.61763 0.59190 0.54393 0.50025 0.46043 0.42410 0.39092 0.36061 0.19381 10 0.90529 0.86167 0.82035 0.78120 0.74409 0.70892 0.67556 0.64393 0.61391 0.58543 0.55839 0.50835 0.46319 0.42241 038554 0.35218 0.32197 0.16151 11 0.89632 0.84893 0.80426 0.76214 0.72242 0.68495 0.64958 0.61620 0.58468 0.55491 0.52679 0.47509 0.42888 0.38753 0.35049 0.31728 0.28748 0.13459 12 0.88745 0.83639 0.78849 0.74356 0.70138 0.66178 0.62460 0.58966 0.55684 0.52598 0.49697 0.44401 0.39711 0.35553 0.31863 0.28584 0.25668 0.11216 13 0.87866 0.82403 0.77303 0.72542 0.68095 0.63940 0.60057 0.56427 0.53032 0.49856 0.46884 0.41496 0.36770 0.32618 0.28966 0.25751 0.22917 0.09346 14 0.86996 0.81185 0.75788 0.70773 0.66112 0.61778 0.57748 0.53997 0.50507 0.47257 0.44230 0.38782 0.34046 0.29925 0.26333 0.23199 0.20462 0.07789 15 0.86135 0.79985 0.74301 0.69047 0.64186 0.59689 0.55526 0.51672 0.48102 0.44793 0.41727 0.36245 0.31524 0.27454 0.23939 0.20900 0.18270 0.06491 16 0.85282 0.78803 0.72845 0.67362 0.62317 0.57671 0.53391 0.49447 0.45811 0.42458 0.39365 0.33873 0.29189 0.25187 0.21763 0.18829 0.16312 0.05409 17 0.84438 0.77639 0.71416 0.65720 0.60502 0.55720 0.51337 0.47318 0.43630 0.40245 0.37136 0.31657 0.27027 0.23107 0.19784 0.16963 0.14564 0.04507 18 0.83602 0.76491 0.70016 0.64117 0.58739 0.53836 0.49363 0.45280 0.41552 0.38147 0.35034 0.29586 0.25025 0.21199 0.17986 0.15282 0.13004 0.03756 19 0.82774 0.75361 0.68643 0.62553 0.57029 0.52016 0.47464 0.43330 0.39573 0.36158 0.33051 0.27651 0.23171 0.19449 0.16351 0.13768 0.11611 0.03130 20 0.81954 0.74247 0.67297 0.61027 0.55368 0.50257 0.45639 0.41464 0.37689 0.34273 0.31180 0.25842 0.21455 0.17843 0.14864 0.12403 0.10367 0.02608 21 0.81143 0.73150 0.65978 0.59539 0.53755 0.48557 0.43883 0.39679 0.35894 0.32486 0.29416 0.24151 0.19866 0.16370 0.13513 0.11174 0.09256 24 0.78757 0.69954 0.62172 0.55288 0.49193 0.43796 0.39012 0.34770 0.31007 0.27666 0.24698 0.19715 0.15770 0.12640 0.10153 0.08170 0.06588 25 0.77977 0.68921 0.60953 0.53939 0.47761 0.42315 0.37512 0.33273 0.29530 0.26223 0.23300 0.18425 0.14602 0.11597 0.09230 0.07361 0.05882 28 0.75684 0.65910 0.57437 0.50088 0.43708 0.38165 033348 0.29157 0.25509 0.22332 0.19563 0.15040 0.11591 0.08955 0.06934 0.05382 0.04187 29 0.74934 0.64936 0.56311 0.48866 0.42435 0.36875 0.32065 0.27902 0.24295 0.21168 0.18456 0.14056 0.10733 0.08215 0.06304 0.04849 0.03738 0.02174 0.01258 0.01048 0.00607 0.00506 30 0.74192 0.63976 0.55207 0.47674 0.41199 0.35628 0.30832 0.26700 0.23138 0.20064 0.17411 0.13137 0.09938 0.07537 0.05731 0.04368 0.03338 0.00421 31 0.73458 0.63031 0.54125 0.46511 0.39999 0.34423 0.29646 0.25550 0.22036 0.19018 0.16425 0.12277 0.09202 0.06915 0.05210 0.03935 0.02980 0.00351 40 0.67165 0.55126 0.45289 0.37243 0.30656 0.25257 0.20829 0.17193 0.14205 0.11746 0.09722 0.06678 0.04603 0.03184 0.02209 0.01538 0.01075 0.00068