At January 1, 2023, Widget World Corporation leased manufacturing equipment from Clinton Corporation under a 6-year lease agreement. The lease agreement specifies annual payments of $25,000 beginning January 1, 2023, the beginning of the lease, and on each December 31 thereafter through 2030 . The equipment was acquired recently by Clinton at a cost of $146,163 (its fair value) and was expected to have a useful life of 8 years with no salvage value at the end of its life. Because the lease term is only 6 years, the asset does have an expected residual value at the end of the lease term of $28,000. Clinton seeks a 7% return on its lease investments. By this arrangement, the lease is deemed to be a finance lease. 4. Record the first lease payment on January 1,2023. \begin{tabular}{|l|l|l|l|l|} \hline \multicolumn{1}{|c}{ Date } & General Journal & Debit \\ \hline & January 1,2023 & Cash & & \\ \hline & & & \\ \hline \end{tabular} 5. Record the amortization of the right-of-use asset on December 31,2023. \begin{tabular}{|c|r|c|c|c|} \hline Date & General Journal & Debit & \\ \hline December 31,2023 & & & \\ \hline \end{tabular} 6. Indicate the amounts related to the lease reported on the year-end balance sheets and income statements. \begin{tabular}{|c|c|c|c|c|} \hline & \multicolumn{2}{|c|}{ Balance Sheet Amounts } & \multicolumn{2}{c|}{ Income Statement Amounts } \\ \hline Date & Right-of-UseAsset & Lease Liability & Interest Expense & Amortization \\ \hline December 31, 2023 & & & & Expense \\ \hline \end{tabular} At January 1, 2023, Widget World Corporation leased manufacturing equipment from Clinton Corporation under a 6-year lease agreement. The lease agreement specifies annual payments of $25,000 beginning January 1, 2023, the beginning of the lease, and on each December 31 thereafter through 2030 . The equipment was acquired recently by Clinton at a cost of $146,163 (its fair value) and was expected to have a useful life of 8 years with no salvage value at the end of its life. Because the lease term is only 6 years, the asset does have an expected residual value at the end of the lease term of $28,000. Clinton seeks a 7% return on its lease investments. By this arrangement, the lease is deemed to be a finance lease. 4. Record the first lease payment on January 1,2023. \begin{tabular}{|l|l|l|l|l|} \hline \multicolumn{1}{|c}{ Date } & General Journal & Debit \\ \hline & January 1,2023 & Cash & & \\ \hline & & & \\ \hline \end{tabular} 5. Record the amortization of the right-of-use asset on December 31,2023. \begin{tabular}{|c|r|c|c|c|} \hline Date & General Journal & Debit & \\ \hline December 31,2023 & & & \\ \hline \end{tabular} 6. Indicate the amounts related to the lease reported on the year-end balance sheets and income statements. \begin{tabular}{|c|c|c|c|c|} \hline & \multicolumn{2}{|c|}{ Balance Sheet Amounts } & \multicolumn{2}{c|}{ Income Statement Amounts } \\ \hline Date & Right-of-UseAsset & Lease Liability & Interest Expense & Amortization \\ \hline December 31, 2023 & & & & Expense \\ \hline \end{tabular}
