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On January 1, 2017, Shamrock Company leased equipment to Bridgeport Corporation. The following information pertains to this lease. 1. The term of the noncancelable lease

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On January 1, 2017, Shamrock Company leased equipment to Bridgeport Corporation. The following information pertains to this lease. 1. The term of the noncancelable lease is 6 years, with no renewal option. The equipment reverts to the lessor at the termination of the lease. 2. Equal rental payments are due on January 1 of each year, beginning in 2017. 3. The fair value of the equipment on January 1, 2017, is $147,000, and its cost is $117,600. 4. The equipment has an economic life of 8 years, with an unguaranteed residual value of $9,000. Bridgeport depreciates all of its equipment on a straight-line basis. 5. Shamrock set the annual rental to ensure an 10% rate of return. Bridgeport's incremental borrowing rate is 11%, and the implicit rate of the lessor is unknown. 6. Collectibility of lease payments is reasonably predictable, and no important uncertainties surround the amount of costs yet to be incurred by the lessor. (Both the lessor and the lessee's accounting period ends on December 31.) Click here to view factor tables X Your answer is incorrect. Calculate the amount of the annual rental payment. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971.) The amount of the annual rental payment $ 30279 Prepare all the necessary journal entries for Bridgeport for 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971.) Date Account Titles and Explanation Debit Credit 1/1/17 v Leased Equipment 139428 139428 Lease Liability 139428 (To record the lease.) Lease Liability 30279 Cash 30279 30279 (To record lease payment.) 12/31/17 v Depreciation Expense Accumulated DepreciationCapital Leases (To record depreciation.) Interest Expense 109149 Interest Payable 109149 109149 | (To record interest.) Prepare all the necessary journal entries for Shamrock for 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,971.) Date Account Titles and Explanation Debit Credit 1/1/17 Lease Receivable 147000 Cost of Goods Sold Sales Revenue 142188 Inventory 117600 (To record the lease.) Cash 30279 Lease Receivable 30279 (To record lease payment.) 12/31/17 Interest Expense 116721 Interest Revenue 116721 (To record interest.) Table 6.5 PRESENT VALUE OF AN ANNUITY DUE OF 1 PVF-AD.j = 1 + utjat (n) Periods 2% 24% 3% 4% 5% 6% 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.98039 1.97561 1.97087 2.94156 2.92742 2.91347 3.88388 3.85602 3.82861 4.80773 4.76197 4.71710 5.71346 5.64583 5.57971 6.60143 6.50813 6.41719 7.47199 7.34939 7.23028 8.32548 8.17014 8.01969 9.16224 8.97087 8.78611 .98259 9.75206 9.53020 1.96154 1.95238 1.94340 2.886092.85941 2.83339 3.77509 3.72325 3.67301 4.62990 4.54595 4.46511 5.45182 5.32948 5.21236 6.24214 6.075695.91732 7.00205 6.78637 6.58238 7.73274 7.46321 7.20979 8.43533 8.10782 7.80169 9.11090 8.721738.36009 11 9 10.78685 10.51421 10.25262 9.76048 9.30641 8.88687 13 11.57534 11.25776 10.95400 10.38507 9.86325 9.38384 8% 9% 10% 11% 12% 15% 1.00000 1.00000 1.00000 1.0000 1.00000 1.0000 (n) Periods 1 11.92593 191743 1.90909 190090 1.89286 1.86957 2 2.78326 2.75911 2.73554 2.71252 2.69005 2.62571 3.57710 3.53130 3.48685 3.44371 3.40183 3.28323 4.31213 4.23972 4.16986 4.10245 4.03735 3.85498 5 4.99271 4.88965 4.79079 4.69590 4.60478 4.35216 5.62288 5.48592 535526 523054 5.11141 4.7848 6.20637 6.03295 5.86842 5.71220 5.56376 5.16042 6.74664 6.53482 6.33493 6.14612 5.96764 5.48732 7.24689 6.99525 6.75902 6.53705 6.32825 5.77158 17.71008 7.41766 7.14457 688923 6.65022 601877 11 8.13896 7.80519 7.49506 720652 693770 6.23371 12 8.53608 8.16073 7.81369 7.49236 7.19437 6.42062 13 8.90378 8.48690 8.10336 774987 7.42355 6.58315 14 15 9.24424 8.78615 8.36669 798187 7.62817 6.72448 9.55948 9.06069 8.60608 8.19087 7.81086 6.84737 16 9.85137 931256 8.82371 8.37916 7.97399 695424

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