On January 1, 2015, the City of Verga leased a large truck for five years and made the initial annual payment of $26,500 immediately. The present value of these five payments based on an 5 percent interest rate is assumed to be $114,700. The truck has an expected useful life of 5 years.

a.

Assuming that the citys fire department will use the truck, what journal entries should be made for 2015 and 2016 on the government-wide financial statements? (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answer to the nearest dollar amount.) 1. Record the entry for capital lease at the beginning of the year. 2. Record first payment of the leased truck. 3. Record depreciation. 4. Record payment on leased truck. 5. Record depreciation.

b.

Assuming that citys fire department will use the truck, what journal entries should be made for 2015 and 2016 on the fund financial statements? (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answer to the nearest dollar amount.) 1. Record signing of a five-year lease for a truck that meets the requirements of a capital lease. 2. Record first payment of the leased truck. 3. Record payment at the end of the first year on leased truck recorded as a capital lease. 4. Record payment at the end of second year on leased truck recorded as a capital lease.