On January 1, 2024, Harlon Consulting entered into a three-year lease for new office space agreeing to lease payments of $6,700 in 2024, $9,400 in 2025, and $12,100 in 2026. Payments are due on December 31 of each year with the first payment being made on December 31, 2024. Harlon is aware that the lessor used a 4% interest rate when calculating lease payments.

Required:

1-4. Prepare the appropriate entries for Harlon Consulting on January 1, 2024, December 31, 2024, 2025 and 2026 to record the lease.

Note: Use tables, Excel, or a financial calculator. If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your intermediate and final answers to nearest whole dollar. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)

1. Record for Harlon Consulting the beginning of the lease, January 1, 2024

2. Record the lease payment for Harlon Consulting. December 31, 2024

3. Record the amortization expense for Harlon Consulting. December 31, 2024

4. Record the lease payment for Harlon Consulting. December 31, 2025

5. Record the amortization expense for Harlon Consulting. December 31, 2025

6. Record the lease payment for Harlon Consulting. December 31, 2026

7. Record the amortization expense for Harlon Consulting. December 31, 2026

Journal entry Key

• No journal entry required

• Accumulated depreciation

• Amortization expense

• Building

• Cash

• Cost of goods sold

• Deferred sales revenue

• Depreciation expense

• Equipment

• Interest expense

• Interest payable

• Interest receivable

• Interest revenue

• Lease payable

• Maintenance expense

• Notes payable

• Prepaid expense

• Right-of-use asset

• Sales revenue

• Selling expense