Ivanhoe Corp., which uses IF RS signs nonrenewable, noncancellable lease agreement to lease robotic equipment from Oriole Inc.
The following information concerns the lease agreement.
Inception date
Lease term
Fair value of equipment Jan.
Economic life of leased equipment
Annual rental payments starting Jan. W
Option to purchase at the end of the term
Depreciation method
Residual value
Ivanhoe's incremental borrowing rate
January
years
$
years
$
none
Straightline
none
Using factor tables, a financial calculator, or Excel functions, calculate the amount of the rightofuse asset and lease liability. Round factor values to decimal places, eg and final answers to O decimal places, eg
The amount of the rightofuse asset
Prepare the initial entry to reflect the signing of the lease agreement. List all debit entries before credit entries. Credit account titles are automatically indented when the amount is extered. Do not indent manually. If no entry is required, select No entry" for the account titles and enter for the amounts.
