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On Januray 1, 2017, Sony Corporation sold machine with a book value of $112,000 to Speedy Finance for $140,000 and immediately leased it back. -The

On Januray 1, 2017, Sony Corporation sold machine with a book value of $112,000 to Speedy Finance for $140,000 and immediately leased it back.

-The term of the lease is 3 years, and the machine has a useful life of 5 years. There is no bargain purchase option, and title dose not tranfer to Sony at lease end.

-The lease requires three equal payment of $34, 784 on December 31.

-The implicit rate of interest is 6%.

-The unguaranteed residual value is expected to be $56,000.

-Prepare the 2017 journal entries for Sony Corporation and the journal entries for Speedy Finance.

I think there should be a gain of $28,000 and that the ROU Asset $92,978. Please show all of your work, will thumbs up!

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