On January 1, 2018, Robertson Construction Leased Several Items of Equipment

question 133

Essay

On January 1, 2018, Robertson Construction leased several items of equipment under a two-year operating lease agreement from Jamison Leasing, which routinely finances equipment for other firms at an annual interest rate of 4%. The contract calls for four rent payments of $40,000 each, payable semiannually on June 30 and December 31 each year. The equipment was acquired by Jamison Leasing at a cost of $360,000 and was expected to have a useful life of five years with no residual value. Both firms record amortization and depreciation semi-annually.
-Required:
Prepare the appropriate journal entries for the lessee from the beginning of the lease through the end of 2018. Round your answers to the nearest whole dollar amounts.

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Definitions:

Central Concepts

Foundational ideas or principles that are essential to understanding a particular field or topic.

Going to a Restaurant

The activity involving choosing, visiting, and eating at a restaurant, including the social and economic exchanges involved.

Agreement

A mutual understanding or arrangement between two or more parties.

Description Level

The degree of detail and specificity with which thoughts, observations, or phenomena are expressed or documented.