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IC Leasing leased electronic equipment to Georgia-Atlantic on January 1, 2021. IC Leasing purchased the...

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Accounting

IC Leasing leased electronic equipment to Georgia-Atlantic on January 1, 2021. IC Leasing purchased the equipment from International Machines at a cost of $153,255. Here is the related information:

Lease term 2 years (8 quarters)

Quarterly payments $20,000 at the beginning of each period

Economic life 2 years

Fair value of asset $153,255

Annual implicit rate 5%

What do the lessors entries include on April 1, 2021?

a.

Debit Lease Receivable by $20,000
b.

Debit Lease Receivable by $18,334 and Interest Revenue by $1,666
c.

None of the answers are correct
d.

Credit Lease Receivable by $20,000
e.

Credit Lease Receivable by $18,334 and Interest Revenue by $1,666

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