Morgan Leasing Company signs an agreement on January 1, 2020, to lease equipment to Cole Company. The following information relates to this agreement. 1. The term of the non-cancelable lease is 6 years with no renewal option. The equipment has an estimated economic life of 6 years. 2. The cost of the asset to the lessor is $245,000. The fair value of the asset at January 1, 2020. is $245,000. 3. The asset will revert to the lessor at the end of the lease term, at which time the asset is expected to have a residual value of $24,335, none of which is guaranteed. 4. The agreement requires equal annual rental payments, beginning on January 1, 2020. 5. Collectibility of the lease payments by Morgan is probable. Click here to view factor tables. (a) Your answer is correct. Assuming the lessor desires a 8% rate of return on its investment, calculate the amount of the annual rental payment required. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and the final answer to O decimal places eg. 5,275.) Amount of the annual rental payment $ 46,000 Prepare an amortization schedule that is suitable for the lessor for the lease term. (Round answers to decimal places eg. 5,275.) MORGAN LEASING COMPANY (Lessor) Lease Amortization Schedule Annual Lease Payment Plus URV Date Interest on Lease Receivable Recovery of Lease Receivable Lease Re 1/1/20 $ 0 $ $ 1/1/20 46,000 0 46.000 1/1/21 46000 15,920 30,080 1/1/22 46000 13,514 32.486 1/1/23 46000 10,915 35,085 1/1/24 46000 8.10B 37,892 1/1/25 46000 5,076 40,924 12/31/25 24,335 1,803 22 532 300,335 $ 55,336 $ 244 999 MORGAN LEASING COMPANY (Lessor) Lease Amortization Schedule Interest on Lease Receivable Recovery of Lease Receivable Lease Receivable $ $ 0 $ 0 $ 245.000 0 46,000 199,000 15.920 30,080 168,920 13,514 32,486 136,433 10,915 35,085 101,348 8,108 37,892 63,456 5,076 40,924 22.532 1.803 22,532 0 $ 55.336 $ 244,999 Date Account Titles and Explanation Debit Credit 1/1/20 Lease Receivable 245,000 Equipment 24 Cash 46,000 Lease Receivable 4 (To record the lease) 11/20 Interest Receivable 15,920 Interest Revenue 1 (To record the receipt of lease payment) 12/31/20 Cash 30,080 Lease Receivable 30 11/21