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Exercise 15-8 Sales-type lease with selling profit; lessor; calculate lease payments [LO15-3] Manufacturers Southern leased high-tech electronic equipment from International Machines on January 1, 2018. International Machines manufactured the equipment at a cost of $99,000. Manufacturers Southern's fiscal year ends December 31. (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 2 years (8 quarterly periods) $16,700 at the beginning of each period 2 years $126,890 Lease term Quarterly rental payments Economic life of asset Fair value of anset Implicit interest rate Required 1. Show how International Machines determined the $16,700 quarterly lease payments. 2. Prepare appropriate entries for International Machines to record the lease at its beginning, January 1, 2018, and the second lease payment on April 1, 2018. Complete this question by entering your answers in the tabs below Required 1 Required 2 2. Prepare appropriate entries for International Machines to record the lease at its payment on April 1, 2018. Complete this question by entering your answers in the tabs below Required 1 Required 2 Show how International Machines determined the $16,700 quarterly lease payments answers to nearest whole dollar.) PV factors based on Table or Calculator function: PV of Lease Lease Payment Required 2

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