Business, 12.04.2021 22:30 Jana1517

A lessor and a lessee signed a lease agreement that qualifies as an operating lease and calls for annual lease payments of $26,269 over a three-year lease term. The asset's estimated useful life is six years. The first payment is due on January 1st, which is the beginning of the lease. The interest rate is 5%. Based on these facts, the present value of the lease payments has been determined to be $75,114. Required: [1] For the lessee, prepare the journal entries necessary at the time of lease signing. Why isn't there an entry for the lessor? [2] For both the lessor and the lessee, prepare the journal entries necessary at the first lease payment (January 1st). [3] For both the lessor and the lessee, prepare the journal entries necessary at the second lease payment (December 31st). For this problem, don't worry about recording the entries necessary for amortization (lessee) and depreciation expense (lessor).

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A lessor and a lessee signed a lease agreement that qualifies as an operating lease and calls for an...

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