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Question 21 Wildhorse Co. as lessee records a finance lease of machinery on January 1, 2021....

Question 21

Wildhorse Co. as lessee records a finance lease of machinery on January 1, 2021. The seven annual lease payments of $750,000 are made at the end of each year. The present value of the lease payments at 10% is $3,651,000. Wildhorse uses the effective-interest method of amortization and sum-of-the-years'-digits depreciation (no residual value).
Prepare an amortization table for 20121 and 2022.

Wildhorse Co.
Lease Amortization Schedule

Date

Annual Lease
Receipt/Payment

Interest on
Receivable/Liability

Reduction in
Receivable/Liability

Lease
Receivable/Liability
1/1/21 $
12/31/21 $ $ $
12/31/22

Prepare all of Wildhorse's journal entries for 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation

Debit

Credit

(To record the lease)

(To record the first lease payment)

(To record depreciation)

Solutions

Expert Solution

ekkarill92 answered 1 year ago
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