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CHAPTER 15 (10.)

Manufacturers Southern leased high-tech electronic equipment from Edison Leasing on January 1, 2018. Edison purchased the equipment from International Machines at a cost of $129,170. (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.)

Related Information:
Lease term	2 years (8 quarterly periods)
Quarterly rental payments	$17,000 at the beginning of each period
Economic life of asset	2 years
Fair value of asset	$129,170
Implicit interest rate	6%
(Also lessees incremental borrowing rate)

Required: Prepare appropriate entries for Manufacturers Southern from the beginning of the lease through January 1, 2019. Depreciation is recorded at the end of each fiscal year (December 31) on a straight-line basis.

BELOW IS THE PICTURES OF THE AMOUNTS AND TRANSACTIONS I GOT WRONG.

General Journal Credit No 1 Date January 01, 2018 Lease revenue Lease payable Debit 129,170 129,170 2 January 01, 2018 Lease payable 17,000 Cash 42 17,000 April 01, 2018 Interest expense Lease payable Cash 1,683 15,317 17,000 July 01, 2018 Interest expense Lease payable Cash 1,453 15,547 17,000 October 01, 2018 Interest expense Lease payable Cash 1,220 15,780 17,000 6 December 31, 201 Interest expense Lease payable Cash 64,585 December 31, 201 Depreciation expense Accumulated depreciation 64,585 January 01, 2019 Interest expense Lease payable Cash 983 16,017 17,000

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