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please solve A through F and show how you calculated each value Recording Entries for Sales-Type Lease with Unguaranteed Residual Value-Lessor Lessor Corporation, a manufacturer
please solve A through F and show how you calculated each value
Recording Entries for Sales-Type Lease with Unguaranteed Residual Value-Lessor Lessor Corporation, a manufacturer of equipment, enters into a lease of specialized equipment with Lessee Corp. on January 1 of Year 1. Title to the asset remains with Lessor Corp. at the end of the lease. Lessee Corp. does not guarantee the residual value of the specialized equipment at the end of the lease term, and the lease contains no renewal or purchase options. The following information pertains to the lease. Complete the following requirements from the lessor's perspective. Assume that the lessor classifies the equipment as inventory prior to the lease arrangement. Hint. Leased equipment's carrying value does not equal its fair value at lease commencement. b. Determine the lease receivable balance at the lease commencement. - Note: Round your answers to the nearest whole dollar. Initial Lease Receivable: \$ c. Prepare a schedule of the lease receivable for the first two years of the lease term. - Note: Round each amount in the schedule to the nearest whole dollar. Use the rounded amount for later calculations in the schedule. d. Provide journal entries relating to the lease for Lessor Corporation on January 1 and December 31 of Year 1 and Year 2. - Note: Round your answers to the nearest whole dollar. e. What is the gross profit recorded for this lease in the first year? - Note: Round your answers to the nearest whole dollar. - Note: Do not use negative signs with your answers f. If the lessor determined that the unguaranteed residual value was $0 (instead of $400 ), what gross profit would be recorded in the first year? - Note: Round your answers to the nearest whole dollar. - Note: Do not use negative signs with your answers
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