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to this thing - AC20190 Problem 1: Myers Company signs a lease of an equipment $120,000 for three years (straight- line depreciation without any
to this thing - AC20190 Problem 1: Myers Company signs a lease of an equipment $120,000 for three years (straight- line depreciation without any salvage value) on January 1 and must make payments on the lease on 31 Dec, year 1, year 2 and year 3. Interest rate is 8% per annum, and annuity factor is 2.5771. a. Prepare the amortization table Year Lease Liability (beginning of year) Interest Expense Payment Reduction in Lease Liability Lease Liability (end of year) b. Prepare the journal entries for Myers Company for January 1, Year 1 AND December 31, Year 1, Year 2, and Year 3, assuming this is an operating lease c. Repeat question b, assuming this is a capital lease. d. What is the maximum annual rental payment that Myers can make and still permit this lease to qualify as an operating lease?
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