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Operating Lease 1 Bug Corp leases a commercial sprayer from Exterminate Inc for a term...

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Accounting

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Operating Lease 1 Bug Corp leases a commercial sprayer from Exterminate Inc for a term of 6 years on 1/1/17. The lease calls for payments to be made at the beginning of each year in the amount of $3,456.27. There is not guaranteed resisdual value in the lease. The fair value of the sprayer is $30,000 and its economic life is 10 years. Bug's incremental borrowing rate is 5% and the implicit rate the lessor requires is 6%. Prepare an amort table, lease exp schedule and record the assoc journal entries through 1/1/18. Calculate PV of lease payments to get LL and ROU Asset: Amort table Payment Lease expense schedule 1 3 Lease inception Lease expense schedule \begin{tabular}{|l|l|l|l|l|l|} \hline & & & & \\ \hline & & & & & \\ \hline 1 & & & & & \\ \hline 2 & & & & & \\ \hline 3 & & & & & \\ \hline \end{tabular} Lease inception 1st payment Record LEASE EXPENSE 2nd payment

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