Sandhill Corporation is a machinery dealer whose shares trades on the TSX, and so it uses IFRS 16. Sandhill leased a machine to Ernst Ltd. on January 1, 2020. The lease is for a six-year period and requires equal annual payments of $24,861 at the beginning of each year. The first payment is received on January 1, 2020. Sandhill had purchased the machine for its inventory during 2019 for $100,200. Collectibility of lease payments is reasonably predictable, and no important uncertainties exist about costs that have not yet been incurred by Sandhill. Sandhill set the annual rental amount to ensure an 12% rate of return. The machine has an economic life of six years, with no residual value, and reverts to Sandhill at the termination of the lease. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY DUE.

Using time value of money tables, a financial calculator, or Excel functions, calculate the amount of each of the following: (Round factor values to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, e.g. 5,275.)

1.		Gross investment		$enter a dollar amount
2.		Unearned interest income		$enter a dollar amount
3.		Net investment in the lease		$enter a dollar amount

List of Accounts

Prepare all necessary journal entries for Sandhill for 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places, e.g. 5,275.)

Date	Account Titles and Explanation	Debit	Credit
1/1/20	enter an account title to record inception of lease and cost of goods sold	enter a debit amount	enter a credit amount
	enter an account title to record inception of lease and cost of goods sold	enter a debit amount	enter a credit amount
	enter an account title to record inception of lease and cost of goods sold	enter a debit amount	enter a credit amount
	enter an account title to record inception of lease and cost of goods sold	enter a debit amount	enter a credit amount
	enter an account title to record inception of lease and cost of goods sold	enter a debit amount	enter a credit amount
	enter an account title to record inception of lease and cost of goods sold	enter a debit amount	enter a credit amount
	(To record inception of lease and cost of goods sold.)
choose a transaction date 1/1/2012/31/20	enter an account title to record interest	enter a debit amount	enter a credit amount
	enter an account title to record interest	enter a debit amount	enter a credit amount
	(To record interest.)