Manufacturers Southern leased high-tech electronic equipment from International Machines on January 1, 2018. International Machines manufactured the equipment at a cost of $99,000. Manufacturers Southern's fiscal year ends December 31. (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 $16,700 at the beginning of each period Economic life of asset 2 years Fair value of asset $126,890 Implicit interest rate 6% Required: 1. Show how International Machines determined the $16,700 quarterly lease payments. 2. Prepare appropriate entries for International Machines to record the lease at its beginning, January 1, 2018, and the second lease payment on April 1, 2018.

Manufacturers Southern leased high-tech electronic equipment from International Machines on January 1, 2018. International Machines manufactured the equipme ends December 31. (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 Quarterly rental payments Economic life of asset Fair value of asset Implicit interest rate 2 years (8 quarterly periods) $16,700 at the beginning of each period 2 years 126,890 6% Required 1. Show how International Machines determined the $16,700 quarterly lease payment:s 2. Prepare appropriate entries for International Machines to record the lease at its beginning, January 1, 2018, and the second lease payment on April 1, 2018 Complete this question by entering your answers in the tabs below Required Required 2 Prepare appropriate entries for International Machines to record the lease at its beginning, January 1, 2018, and the second lease payment on April 1, 2018. (If no entry is required for a transaction/event, select "No journal entry required in the firs account field. Round your intermediate and final answers to nearest whole dollar.) View transaction list View journal entry worksheet No Date General Journal Debit Credit January 01 2018 126,890 Lease receivable Cost of goods sold Equipment Sales revenue 126,890 January 01 2018 Cash 16,700 Lease receivable 16,700 3 April 01, 2018 Cash 16,700 Lease revenue Lease receivable ?Required 1 Required 2