Please help with incorrect answers
On January 1, 2021, NRC Credit Corporation leased equipment to Brand Services under a finance/sales-type lease designed to earn NRC a 11% rate of return for providing long-term financing. The lease agreement specified the following: a. Ten annual payments of $61,000 beginning January 1, 2021, the beginning of the lease and each December 31 thereafter through 2029. b. The estimated useful life of the leased equipment is 10 years with no residual value. Its cost to NRC was $346,464. c. The lease qualifies as a finance lease/sales-type lease. d. A 10-year service agreement with Quality Maintenance Company was negotiated to provide maintenance of the equipment as required. Payments of $8,000 per year are specified, beginning January 1, 2021. NRC was to pay this cost as incurred, but lease payments reflect this expenditure. e. A partial amortization schedule, appropriate for both the lessee and lessor, follows: (FV of $1, PV of $1, EVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Decrease in Outstanding Payments Effective Interest Balance Balance (11% x Outstanding balance) 346, 464 1/1/2021 53 , 000 53, 000 293, 464 12/31/2021 53, 000 0. 11 (293, 464) = 32, 281 20, 719 272, 745 12/31/2022 53, 000 0. 11 (272, 745) = 30, 002 22, 998 249, 747 Required: 1. Prepare the appropriate entries for the lessee related to the lease on January 1, 2021 and December 31, 2021. 2. Prepare the appropriate entries for the lessor related to the lease on January 1, 2021 and December 31, 2021.Required 1 Required 2 Prepare the appropriate entries for the lessee related to the lease on January 1, 2021 and December 31, 2021. (Round your intermediate and final answers to the nearest whole dollar amount. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No Date General Journal Debit Credit 1 January 01, 2021 Right-of-use asset 346,464 Lease payable V 346,464 2 January 01, 2021 Lease payable V 53,000 V Cash X 53,000 X 3 December 31, 202 Lease payable 20,719 Interest expense V 32,281 Cash X 53,000 X 4 December 31, 202 Amortization expense V 34,636 X Right-of-use asset V 34,636 XRequired 1 Required 2 Prepare the appropriate entries for the lessor related to the lease on January 1, 2021 and December 31, 2021. (Round your intermediate and final answers to the nearest whole dollar amount. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No Date General Journal Debit Credit 1 January 01, 2021 Lease receivable 530,000 X Sales revenue X 530,000 X 2 January 01, 2021 Cash V 53,000 X Lease receivable 53,000 3 December 31, 202 Cash 53,000 X Lease receivable 53,000 X Required 1 Required 2 >
