P$15-11$ Lessee; renewal option LO$15-2,$ LO$15-6$

High Time Tours leased rock$-$climbing equipment from Adventures Leasing on January $1,2024.$ High Time has the option to renew the lease at the end of two years for an additional three years for $$8,000$ per quarter. Adventures purchased the equipment at a cost of $$198,375.$

Related Information:

Lease term Lease renewal option for a additional Quarterly lease payments

Economic llfe of asset

Interest rate charged by the lessor

$2$ years $(8$ quarterly perlods$)$

$3$ years at $$8,000$ per quarter

$$15,000$ on Jan. $1,2024,$ and on Mar. $31,$ June $30,$ Sept. $30,$ and Dec. $31$ thereafter

$5$ years

$8\%$

Required:

Prepare appropriate entries for High Time Tours from the beginning of the lease through March $31,2024.$ Appropriate adjusting entries are made quarterly.

Prepare an amortization schedule for the term of the lease.