On January 1, 2021, Taco King leased retail space from Fogelman Properties. The 10-year finance lease requires quarterly variable lease payments equal to 3% of Taco King's sales revenue, with a quarterly sales minimum of $570,000. Payments at the beginning of each quarter are based on previous quarter sales. During the previous 5-year period, Taco King has generated quarterly sales of over $735,000. Fogelman's interest rate, known by Taco King, was 8%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Prepare the journal entries for Taco King at the beginning of the lease at January 1, 2021. 2. Prepare the journal entries for Taco King at April 1, 2021. First quarter sales were $745,000. Amortization is recorded quarterly. X Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the journal entries for Taco King at the beginning of the lease at January 1, 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to the nearest whole dollar amount.) No Date General Journal Debit Credit 1 January 01, 2021 Right-of-use asset Lease payable 2 January 01, 2021 Lease payable Cash oo On January 1, 2021, Taco King leased retail space from Fogelman Properties. The 10-year finance lease requires quarterly varial lease payments equal to 3% of Taco King's sales revenue, with a quarterly sales minimum of $570,000. Payments at the beginn each quarter are based on previous quarter sales. During the previous 5-year period, Taco King has generated quarterly sales $735,000. Fogelman's interest rate, known by Taco King, was 8%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVA (Use appropriate factor(s) from the tables provided.) Required: 1. Prepare the journal entries for Taco King at the beginning of the lease at January 1, 2021. 2. Prepare the journal entries for Taco King at April 1, 2021. First quarter sales were $745,000. Amortization is recorded quarter X Answer is not complete. Complete this question by entering your answers the tabs below. Required 1 Required 2 Prepare the journal entries for Taco King at April 1, 2021. First quarter sales were $745,000. Amortization is recorded quarterly. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to the nearest whole dollar amount.) No Date General Journal Debit Credit 1 April 01, 2021 Interest expense Lease expense Lease payable Cash 2 April 01, 2021 Amortization expense Right-of-use asset
