On January 1, 2020,SkysongCorp. leased a building to FRN Inc. Both companies follow ASPE. The lease arrangement was for10years. The leased building cost $3,600,000and was purchased for cash on January 1, 2020. The building was to be depreciated on a straight-line basis over its estimated economic life of50years. The lease called for payments of $276,000per year, made at the end of the year. Property tax expense of $66,000and insurance expense of $5,000on the building were incurred bySkysongin the first year. Payment on these two items was made at the end of the year.

Partially correct answer icon

Your answer is partially correct.

Prepare the journal entries made bySkysongCorp. in 2020assumingSkysongprepares financial statements annually.(Credit account titles are automatically indented when the 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.)

Date

Account Titles and Explanation

Debit

Credit

Jan. 1, 2020

Dec. 31, 2020

(To record purchase of building.)

Jan. 1, 2020

Dec. 31, 2020

(To record collection of rent.)

(To record depreciation expense.)

(To record payment of insurance

and property taxes.)

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Partially correct answer icon

Your answer is partially correct.

Prepare the journal entry made by FRN Inc. in 2020assuming FRN prepares financial statements annually.(Credit account titles are automatically indented when the 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.)

Date

Account Titles and Explanation

Debit

Credit

Dec. 31, 2020

(To record rent payment.)