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Myers Company signs a lease of an equipment $90,000 for three years (straight-line depreciation without any salvage value) on January I and must make payments
Myers Company signs a lease of an equipment $90,000 for three years (straight-line depreciation without any salvage value) on January I and must make payments on the lease on 31 Dec, year 1, year 2 and year 3. Interest rate is 10% per annum a. Prepare the amortization table b. Prepare the journal entries for Myers Company for January 1, Year 1 AND December 31, Year 1, Year 2, and Year 3, assuming this is an operating lease. c. Repeat question b, assuming this is a capital lease. I d. What is the maximum annual rental that Myers can make and still permit this lease to qualify as an operating lease
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