Franklin Co. leased its manufactured equipment to Parker Inc. for a 4-year term. Franklin Co....
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Franklin Co leased its manufactured equipment to Parker Inc. for a year term. Franklin Co reported a book value of $ for the equipment in its inventory account. The lease commenced on January with the first annual payment of $ due immediately. The equipment has a useful life of years, an estimated fair value of $ and no residual or salvage value. The implicit rate of the lease is and collectability of the lease payments from Parker is probable. Franklin's journal entries at the commencement of the salestype lease would include. A Credit of fair value to Sales Revenue B A debit of net book value to Cost of Goods Sold C A credit to Lease Receivable for the first annual payment D A&B E All of the above 
Franklin Co leased its manufactured equipment to Parker Inc. for a year term. Franklin Co reported a book value of $ for the equipment in its inventory account. The lease commenced on January with the first annual payment of $ due immediately. The equipment has a useful life of years, an estimated fair value of $ and no residual or salvage value. The implicit rate of the lease is and collectability of the lease payments from Parker is probable. Franklin's journal entries at the commencement of the salestype lease would include.
A Credit of fair value to Sales Revenue
B A debit of net book value to Cost of Goods Sold
C A credit to Lease Receivable for the first annual payment
D A&B
E All of the above
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