Manufacturers Southern leased high-tech electronic equipment from Edison Leasing on January 1, 2021. Edison purchased the equipment from International Machines at a cost of $119,292. (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.)

Related Information:
Lease term	2 years (8 quarterly periods)
Quarterly rental payments	$15,700 at the beginning of each period
Economic life of asset	2 years
Fair value of asset	$119,292
Implicit interest rate	6%
(Also lessees incremental borrowing rate)

Required: Prepare a lease amortization schedule and appropriate entries for Manufacturers Southern from the beginning of the lease through January 1, 2022. Amortization of the right-of-use asset is recorded at the end of each fiscal year (December 31) on a straight-line basis.

Payment Date	Lease Payments	Effective Interest	Decrease in Balance	Lease Balance
				$119,292
01/01/2021	$15,700	0	$15,700	103,592
04/01/2021	15,700	$1,554	$14,146	89,446
07/01/2021	15,700
10/01/2021
01/01/2022
04/01/2022
07/01/2022
10/01/2022
Total	$47,100	$1,554	$29,846

No	Date	General Journal	Debit	Credit
1	January 01, 2021	Right-of-use asset	119,292
		Lease payable		119,292
2	January 01, 2021	Lease payable	15,700
		Cash		15,700
3	April 01, 2021	Interest expense
		Lease payable
		Cash		15,700
4	July 01, 2021	Interest expense
		Lease payable
		Cash		15,700
5	October 01, 2021	Interest expense
		Lease payable
		Cash
6	December 31, 2021	Interest expense
		Interest payable
7	December 31, 2021	Amortization expense
		Right-of-use asset
8	January 01, 2022	Interest payable
		Lease payable
		Cash