1. Rick Kleckner Corporation recorded a capital lease at $300,000 on January 1, 2017. The interest rate is 12%. Kleckner Corporation made the first payment of $53,920 on January 1, 2017. The lease requires eight annual payments. The equipment has a useful life of 8 years with no salvage value. Prepare Kleckner Corporations December 31, 2017, adjusting entries.
2. Use the information for Rick Kleckner Corporation from # Assume that at December 31, 2017, Kleckner made an adjusting entry to accrue interest expense of $29,530 on the lease. Prepare Kleckners January 1, 2018, journal entry to record the second lease payment of $53,920.