Ivanhoe Corporation manufactures drones. On December 31, 2024, it leased to Cullumber Company a drone...
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Ivanhoe Corporation manufactures drones. On December 31, 2024, it leased to Cullumber Company a drone that had cost $119,700 to manufacture. The lease agreement covers the 5-year useful life of the drone and requires 5 equal annual rentals of $42,300 payable each December 31 , beginning December 31,2024 . An interest rate of 8% is implicit in the lease agreement. Collectibility of the rentals is probable. Prepare Ivanhoe's December 31, 2024, journal entries. (List all debit entries before credit entries. 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 0 for the amounts. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to 0 decimal places e.g. 5,275.) Click here to view factor tables. Credit (To record lease liability) Lease Liability 24000 (To record lease payment) 12/31/25 Lease Expense 24000 Lease Liability Right-of-Use Asset
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