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On May 1, Year 4, Atlas Company renewed the equipment lease at a new rate of $900 per month. The renewal lease was also for
On May 1, Year 4, Atlas Company renewed the equipment lease at a new rate of $900 per month. The renewal lease was also for one year starting on May 1, Year 4. The terms of the new agreement require Atlas to receive rent for the entire twelve months at the end of the second twelve-month period, May 1, Year 5. Nothing has been done in Year 4 in the accounting records of the firm related to these accounts until your adjusting journal entry on December 31, Year 4. Required: Show the proper adjusting journal entry at December 31, Year 4.
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