Universal Leasing leases electronic equipment to a variety of businesses. The companys primary service is providing alternate financing by acquiring equipment and leasing it to customers under long-term sales-type leases. Universal earns interest under these arrangements at a 10% annual rate. The company leased an electronic typesetting machine it purchased for $36,900 to a local publisher, Desktop Inc. on December 31, 2017. The lease contract specified annual payments of $8,353 beginning January 1, 2018, the beginning of the lease, and each December 31 through 2019 (three-year lease term). The publisher had the option to purchase the machine on December 30, 2020, the end of the lease term, for $18,700 when it was expected to have a residual value of $22,700, a sufficient difference that exercise seems reasonably certain. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

Required: 1. Show how Universal calculated the $8,353 annual lease payments for this sales-type lease. 2. Prepare an amortization schedule that describes the pattern of interest revenue for Universal Leasing over the lease term. 3. Prepare the appropriate entries for Universal Leasing from the beginning of the lease through the end of the lease term

Check my work The company leased an electronic typesetting machine it purchased for $36,900 to a local publisher, Desktop Inc. on December 31, 2017. The lease contract specified annual payments of $8,353 beginning January 1, 2018, the beginning of the lease, and each December 31 through 2019 (three-year lease term). The publisher had the option to purchase the machine on December 30, 2020, the end of the lease term, for $18,700 when it was expected to have a residual value of $22,700, a sufficient difference that exercise seems reasonably certain. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) 20 points eBook Required: 1. Show how Universal calculated the $8,353 annual lease payments for this sales-type lease. 2. Prepare an amortization schedule that describes the pattern of interest revenue for Universal Leasing over the lease term. 3. Prepare the appropriate entries for Universal Leasing from the beginning of the lease through the end of the lease term. Hint Print References Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare an amortization schedule that describes the pattern of interest revenue for Universal Leasing over the lease term. (Round your intermediate and final answers to the nearest whole dollar amount. Enter all amounts as positive values.) Date Lease Amortization Schedule Effective Decrease in Payments Interest Balance Outstanding Balance 36,900 8,353 8,353 01/01/2018 12/31/2018 12/31/2019 12/31/2020 Total 4. Chapter 15 A Saved Help Save Prepare the appropriate entries for Universal Leasing from the beginning of the lease through the end of the lease term. (Round your intermediate and final answers to the nearest whole dollar amount. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) 20 points View transaction list View journal entry worksheet General Journal Debit Credit eBook No 1 Date January 01, 2018 Lease receivable Equipment Hint Print 2 References January 01, 2018 Cash Lease receivable 3 December 31, 2018 Cash Lease receivable Interest revenue 4 December 31, Cash 2019 Lease receivable Interest revenue / 5 December 30, 2020 Cash Lease receivable Interest revenue