Problem 3 (22 points) On January 1, 716, Rory Corporation (lessor) leased several copy machines to Calhoun Company (lessee). The lease was a five-year lease, with five equal payments, the first being made January 1, 716 and subsequent payments being made on January 1 of each year. Rory Corporation's implicit interest rate is 10% and Calhoun's incremental borrowing rate is 6%, and Calhoun is aware of Rory's implicit rate. The copy machines are being leased at their cost of $42,000. The useful life of the copy machines is eight-years. Assume this is an Operating lease. For credit show all computations. Required: 1) Determine the dollar amount of the lease payments that will be charged by Rory Corporation. 2) Prepare all the necessary journal entries for both companies on 1/1/16, 12/31/16, 1/1/17, and 12/31/y17. Date Loan Amortization Schedule Put I nt Pria Bal Calhoun (lessee) Rory (lessor) Debit Credit Debit Credit Problem 3 (22 points) On January 1, 716, Rory Corporation (lessor) leased several copy machines to Calhoun Company (lessee). The lease was a five-year lease, with five equal payments, the first being made January 1, 716 and subsequent payments being made on January 1 of each year. Rory Corporation's implicit interest rate is 10% and Calhoun's incremental borrowing rate is 6%, and Calhoun is aware of Rory's implicit rate. The copy machines are being leased at their cost of $42,000. The useful life of the copy machines is eight-years. Assume this is an Operating lease. For credit show all computations. Required: 1) Determine the dollar amount of the lease payments that will be charged by Rory Corporation. 2) Prepare all the necessary journal entries for both companies on 1/1/16, 12/31/16, 1/1/17, and 12/31/y17. Date Loan Amortization Schedule Put I nt Pria Bal Calhoun (lessee) Rory (lessor) Debit Credit Debit Credit