On January 1, 2021, NRC Credit Corporation leased equipment to Brand Services under a finance/sales-type lease designed to earn NRC a 11% rate of return for providing long-term financing. The lease agreement specified the following a. Ten annual payments of $64,000 beginning January 1, 2021, the beginning of the lease and each December 31 thereafter through 2029 b. The estimated useful life of the leased equipment is 10 years with no residual value. Its cost to NRC was $392,223 c. The lease qualities as a finance lease/sales-type lease. d. A 10-year service agreement with Quality Maintenance Company was negovated to provide maintenance of the equipment as required. Payments of $4.000 per year are specified, beginning January 1 2021. NRC was to pay this cost as incurred, but lease payments reflect this expenditure e. A partial amortization schedule, appropriate for both the lessee and lessor, follows (FV ORSI, PV of $1. FVA of $1. PVA of $1. EVAD of S1 and PVAD of $.1) (Use appropriate factor(s) from the tables provided.) Payments Effective Interest (11% Outstanding balance) Decrease in Balance Outstandine Balance 1/1/2021 12/31/2021 12/31/2022 60,000 60,000 68,000 0.11 (332,223) - 36,545 3.11 (308,768) - 33,964 60,000 23,455 26,036 392,223 332,223 308,768 282,732 Required: 1. Prepare the appropriate entries for the lessee related to the lease on January 1, 2021 and December 31, 2021 2. Prepare the appropriate entries for the lessor related to the lease on January 1, 2021 and December 31, 2021 Complete this question by entering your answers in the tabs below. Requited 1 Required 2 Prepare the appropriate entries for the lessor related to the lease on January 1, 2021 and December 31, 2021. (Round your intermediate and final answers to the nearest whole dollar amount. Il no entry is required for a transaction/event, seloct"No journal entry required in the first account field urnal entry worksheet 1 2 2 3 > Record the cash received (include maintenance fee accrual). ote: Enter debits before credits. Credit Date General Journal January 01, 2021 Cash Maintenance fee payable Please receivable Debit 64,000 Record entry Clear entry View general journal Required 1 Required 2 Prepare the appropriate entries for the lessor related to the lease on January 1, 2021 and and final answers to the nearest whole dollar amount. If no entry is required for a transacti the first account field.) View transaction list Journal entry worksheet
