n January 1, Year 1, Mitchell-Marsh Services, Inc., a computer software training firm, leased several computers under a two-year lease agreement from Global Computers Corporation, which routinely finances equipment for other firms at an annual interest rate of 6%. The contract calls for four rent payments of $15,000 each, beginning January 1, Year 1, and at each June 30 and December 31. The computers were acquired by Global Computers at a cost of $57,429 and were expected to have a useful life of two years with no residual value. Both firms record amortization and depreciation semiannually.

Required (round to the nearest dollar):

1)Calculate the present value of the lease payments on Jan. 1, Year 1.

PVOA (n=2, i=6%) =1.83339; PVAD (n=2, i=6%) =1.94340;

PVOA (n=4, i=3%)=3.71710; PVAD (n=4, i=3%)=3.82861

2) Prepare the appropriate entries for both (a) the lessee and (b) the lessor from the beginning of the lease through the end of Year 1.