On January 1, 2020, Sheffield Inc. sold computer equipment to Sage Hill Co. The sales price of the equipment was $525,000 and its carrying amount is $413,000. Record any journal entries necessary for Sheffield from the sale of the computer equipment in 2020.

On January 1, 2020, Sheffield Inc. sold computer equipment to Sage Hill Co. The sales price of the equipment was $525,000 and its carrying amount is $413,000. Record any journal entries necessary for Sheffield from the sale of the computer equipment in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit 1/1/20 Cash 525000 Gain on Disposal of Equ 112000 Equipment 413000 SHOW LIST OF ACCOUNTS LINK TO TEXT Use the information from part a. Assume that, on the same day the sale occurred, Sheffield enters into an agreement to lease the equipment from Sage Hill for 10 years with annual lease payments of $71,330.65 at the end of each year, beginning on December 31, 2020. If Sheffield has an incremental borrowing rate of 6% and the equipment has an economic useful life of 10 years, record any journal entries necessary for Sheffield from the sale and leaseback of computer equipment in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 2 decimal places, e.g. 5,275.25. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit Use the information from part b. Now, instead of 10 years, the lease term is only 3 years with annual lease payments of $71,330.65 at the beginning of each year. Record any journal entries necessary for Sheffield from the sale and leaseback of computer equipment in 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 2 decimal places, e.g. 5,275.25. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit 1/1/20 vCash 525000 Gain on Disposal of Equ 112000 413000 Equipment (To record sale of equipment) 1/1/20 Right-of-Use Asset Lease Liability (To record the lease) 12/31/20 Lease Liability cash (To record lease payment) 12/31/20 Lease Expense Lease Liability Right-of-Use Asset Click if you would like to Show Work for this question: Open Show Work