Oakridge Leasing Corporation signs an agreement on January 1, 2020, to lease equipment to Oriole Limited. Oakridge and Oriole follow ASPE. The following information relates to the agreement.

1.		The term of the non-cancellable lease is five years, with no renewal option. The equipment has an estimated economic life of six years.
2.		The assets fair value at January 1, 2020, is $85,000.
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 $6,200, which is not guaranteed.
4.		Oriole Limited assumes direct responsibility for all executory costs, which include the following annual amounts: $970 to Rocky Mountain Insurance Ltd. for insurance and $1,710 to James Township for property taxes.
5.		The agreement requires equal annual rental payments of $20,182 to Oakridge, the lessor, beginning on January 1, 2020.
6.		The lessees incremental borrowing rate is 13%. The lessors implicit rate is 12% and is known to the lessee.
7.		Oriole Limited uses the straight-line depreciation method for all equipment.
8.		Oriole uses reversing entries when appropriate.

Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY DUE.

Calculate the PV of the future minimum lease payments using any of the following methods: (1) factor tables, (2) a financial calculator, or (3) Excel functions. (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 1,452.)

Present value

$enter the Present value in dollars

List of Accounts

Prepare an amortization schedule for Oriole Limited for the lease term. (Hint: You may find the ROUND formula helpful for rounding in Excel.) (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 1,452.)

Oriole Limited (Lessee