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  3. 3. landon corporation has decided to rent crew tru

3. Landon Corporation has decided to rent crew trucks rather than purchasing them. On April...

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Accounting

3. Landon Corporation has decided to rent crew trucks rather than purchasing them. On April 1, 20X5, Landon enters into an agreement with TuffEnough Trucks to lease three trucks worth $200,000. The lease agreement will span six years and the life of the trucks is estimated to be seven years. Landons incremental borrowing rate is 6 percent. The payments per year amount to $38,370, payable each April 1, beginning with 20X5.

a. Record the capital lease.

b. Record the first payment on 4/1/X5.

c. Record depreciation on the equipment on 12/31/X5.

d. Record interest expense on 12/31/X5.

e. Record the second payment on 4/1/X6.

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