Southwestern Edison Company leased equipment from Hi-Tech Leasing on January 1, 2018. Hi-Tech manufactured the equipment at a cost of $85,500.
Other information:
Lease term 4 years
Annual payments $31,000 on January 1 each year
Life of asset 4 years
Fair value of asset $110,890
Implicit interest rate 8%
Incremental rate 8%
There is no expected residual value.
Required:
Prepare appropriate journal entries for Hi-Tech Leasing for 2018. Assume a December 31 year-end. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to the nearest whole dollar amounts.)
1.Record the lease.
2.Record the cash received
3.Record the interest revenue
Answers: 1
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Southwestern Edison Company leased equipment from Hi-Tech Leasing on January 1, 2018. Hi-Tech manufa...
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