Question
Manufacturers Southern leased high-tech electronic equipment from International Machines on January 1, 2016. International Machines manufactured the equipment at a cost of $91,000. (FV of
Manufacturers Southern leased high-tech electronic equipment from International Machines on January 1, 2016. International Machines manufactured the equipment at a cost of $91,000. (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 $15,691 at the beginning of each period Economic life of asset 2 years Fair value of asset $117,240 Implicit interest rate 8% (Also lessees incremental borrowing rate)
Required: 2. Prepare appropriate entries for International Machines to record the lease at its inception, January 1, 2016, and the second rental payment on April 1, 2016. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)
1.Record the lease. 2.Record cash received. 3.Record cash received.
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