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Please guide On January 1, 2019, ABC Inc, leased equipment by signing a 6-year noncancelable lease that is appropriately classified as a finance lease. Information

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On January 1, 2019, ABC Inc, leased equipment by signing a 6-year noncancelable lease that is appropriately classified as a finance lease. Information regarding the lease is as follows: Fair value of leased equipment $ 803,003 Annual lease payments due at the beginning of each year, starting Jan. 1, 2019 $ 150,000 Expected residual value at end of lease term $ 20,000 Lessee guaranteed residual value at end of lease term $ 30,000 Economic life of leased equipment 8 years Lessor's implicit rate in the lease (not known by ABC) 6% ABC's incremental borrowing rate 7% Present value factors for n = 6 are as follows: i = 6% i = 7% present value of single sum 0.70496 0.66634 present value of ordinary annuity 4.91732 4.76654 present value of annuity due 5.21236 5.10020 REQUIRED (round amounts in journal entries to the nearest dollar): (1) Prepare ABC's (the lessee) appropriate journal entries at Jan. 1, 2019. (2) Prepare ABC's appropriate journal entries at Dec. 31, 2019 (the end of the fiscal year)

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