* Please answer all*

Wanda Westview Company (WWC) started its operations late in July 2018. The owner (Wanda) assumed she could run the company from her apartment, however, due to covenants in her housing contract she was unable to run her business from home. As a result, Wanda decided to buy a warehouse. After much deliberation and consideration, she determined that leasing a warehouse would be more financially viable than buying one. Wanda reached out to an old friend who helped her lease a warehouse from Vision Inc. The warehouse has a current value of $462,000. The lease calls for WWC to make 25 annual payments of $40,000 beginning January 1st, 2019, which is the beginning of the lease, and at each December 31st, thereafter. The warehouses useful life is 50 years. The going interest rate for warehouse rental in the area is 8%. Assume that the annual amortization expense for the prior period is recorded at the same time as the annual lease payment.

Questions:

1. Is this a financing lease or an operating lease? How did you know?

2. What journal entries will WWC make on January 1st, 2019?

3. What journal entries will WWC make on December 31st, 2019?

4. What journal entries will WWC make on December 31st, 2042?