PROBLEMS P21-1 (L02,4) (Lessee Entries, Finance Lease Lessee Entries, Finance Lease) The following facts pertain to a non-cancelable lease agreement Faldo Leasing Company and Vance Company, alessee January 1, 2017 5113, Commencement date Annual lease payment due at the beginning of each year, beginning with January 1, 2017 Residual value of equipment and of lewem. guaranteed by the Expected residual value of guipment at end of lease term Lease term Economie de ofed equipment Fale value of asset at January 1, 2017 Lessor's implieit rate Lessee's ince mental bowling tale 550.000 545,000 6 years SM0.000 The asset will nevert to thessor at the end of the lease term. The l equipment e uses the straight-line amortization for alle Instructions (a) Prepare an amortization schedule that would be suitable for the lessee for the lease term. (b) Prepare all of the journal entries for the lessee for 2017 and 2018 to record the lease agreement, the lease payments, and all expenses related to this lease. Assume the lessee's annual accounting period ends on December 31. (c) Suppose Vance received a lease incentive of $5,000 from Faldo Leasing to enter the lease. How would the initial mea- surement of the lease liability and right-of-use asset be affected? What if Vance prepaid rent of $5,000 to Faldo? tinn Finance Lease) On January 1, 2017. Cage Company con PROBLEMS P21-1 (L02,4) (Lessee Entries, Finance Lease Lessee Entries, Finance Lease) The following facts pertain to a non-cancelable lease agreement Faldo Leasing Company and Vance Company, alessee January 1, 2017 5113, Commencement date Annual lease payment due at the beginning of each year, beginning with January 1, 2017 Residual value of equipment and of lewem. guaranteed by the Expected residual value of guipment at end of lease term Lease term Economie de ofed equipment Fale value of asset at January 1, 2017 Lessor's implieit rate Lessee's ince mental bowling tale 550.000 545,000 6 years SM0.000 The asset will nevert to thessor at the end of the lease term. The l equipment e uses the straight-line amortization for alle Instructions (a) Prepare an amortization schedule that would be suitable for the lessee for the lease term. (b) Prepare all of the journal entries for the lessee for 2017 and 2018 to record the lease agreement, the lease payments, and all expenses related to this lease. Assume the lessee's annual accounting period ends on December 31. (c) Suppose Vance received a lease incentive of $5,000 from Faldo Leasing to enter the lease. How would the initial mea- surement of the lease liability and right-of-use asset be affected? What if Vance prepaid rent of $5,000 to Faldo? tinn Finance Lease) On January 1, 2017. Cage Company con