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A lease agreement is reached between a lessor and a lessee The term of the lease is $25,000.00 per year for 3 years starting on January 1, 2020, where the first payment is due on January 1, 2020. The lessee's incremental borrowing rate is 7.00%

Create the general journal entries for the lessee on January 1, 2020 when the capital lease is generated, and on December 31, 2020 when the first payment is made.

(check figure: $21,835.97 credit to Lease Obligation on the December 31, 2020 bond payment general journal entry)

VALUE
Date	Payment	Interest	Obligation

1/1/20	Leased Asset
	Lease Obligation
	Cash
12/31/20	Interest Expense
	Lease Obligation
	Cash

Arial 12 ' ' Accounting Pasta 512 Marca Open recovered workbookst Your recent changes werewed Do you want to continut working are you left of Office Update To keep up-to-date with curity dates, tiemprovements, choose Check for Updates A13 Value Alan agreement is reached between assor and also The term of these is $25.0000 per year for 5 years starting on January 1, 2020 where the first payment is due on January 1, 2020 The fessin bawing rate is 100% Create the general jouma entries for the lesson January 1, 2020 when the capitalis generated and on December 31, 2020 when the first payment is made check gure $21383597 to Lease Obligation on the 10 December 31, 2020 bond payment general joumanty 11 12 1 Value 14 15 Da Payment Interest Obligation 16 17 171120 Lossed Asset Lean Obligation Cash 19 20 21 22 120120 Wrest Expens Lease Obligation Cash 24 25 25 29 30 33 34 M 37 Long Term Note Bond Lease Arial 12 ' ' Accounting Pasta 512 Marca Open recovered workbookst Your recent changes werewed Do you want to continut working are you left of Office Update To keep up-to-date with curity dates, tiemprovements, choose Check for Updates A13 Value Alan agreement is reached between assor and also The term of these is $25.0000 per year for 5 years starting on January 1, 2020 where the first payment is due on January 1, 2020 The fessin bawing rate is 100% Create the general jouma entries for the lesson January 1, 2020 when the capitalis generated and on December 31, 2020 when the first payment is made check gure $21383597 to Lease Obligation on the 10 December 31, 2020 bond payment general joumanty 11 12 1 Value 14 15 Da Payment Interest Obligation 16 17 171120 Lossed Asset Lean Obligation Cash 19 20 21 22 120120 Wrest Expens Lease Obligation Cash 24 25 25 29 30 33 34 M 37 Long Term Note Bond Lease