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Problem 21 A-9 a2-c Buffalo Company manufactures a check-in kiosk with an estimated economic life of 12 years and leases it to National Airlines for a period of 10 years. The normal selling price of the equipment is $319,675, and its unguaranteed residual value at the end of the lease term is estimated to be $21,500. National will pay annual payments of $37,800 at the beginning of cach year. Buffalo incurred costs of $184,200 in manufacturing the equipment and $3,700 in sales commissions in Osing the lease. Buffalo has determined that the co e tibility of the lease payments is probable and t at the implicit terest rate is 5% Click here to view fastor tables Compute the amount of each of the following items. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answers to 0 decimal places, e.g. 5,275.) (1) Lease receivable (2) Sales price (3) Cost of sales SHOW LIST OF ACCOUNTS BU ALO COMPANY (Lessor) Lease Amortization Schedule Annuity Due Basis, Unguaranteed Residual Value Beginning Annual Lease Payment Plus Residual Value Interest on Lease Receivable Lease Receivable Recovery Lease Receivable of Year Initial PV 2 4 6 7 8 10 End of 10 Prepare all of the lessor's journal entries for the first year. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round answers to O decimal places e.g. 5,275.) Account Titles and Explanation Debit Credit (To record the sale and the cost of goods sold in the lease transaction) (To record payment of the initial direct costs relating to the lease.) To record receipt of the first lease payment.) To record interest earned during the first year of the lease.)

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