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Please help me solve this Blossom Company, a machinery dealer, leased a machine to Crane Corporation on January 1, 2025. The lease is for an
Please help me solve this
Blossom Company, a machinery dealer, leased a machine to Crane Corporation on January 1, 2025. The lease is for an 8-year period and requires equal annual payments of $28,865 at the beginning of each year. The first payment is received on January 1, 2025 . Blossom had purchased the machine during 2024 for $100,000. Collectibility of lease payments by Blossom is probable. Blossom set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Blossom at the termination of the lease. (a) Your answer is correct. Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to 0 decimal places e.g. 5,275.) Prepare all necessary journal entries for Blossom for 2025. (List all deblt entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places e.g. 5,275. Record journal entries in the order presented in the problem.)Step by Step Solution
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