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Novak Limited has entered into an agreement to lease manufacturing equipment. The following terms are...

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Accounting

Novak Limited has entered into an agreement to lease manufacturing equipment. The following terms are included in the lease:
Lease terms
5 years
Payments required monthly on the last day of the month $3,114
Leasing interest rate
8%? annum
Estimated useful life of equipment
5 years
PV of lease payments
$153,600
The lease is entered into on January 1,2024. The equipment can be purchased for $160,000. The company uses straight-line depreciation.
(a)
Prepare the journal entry for 2024 to recognize the lease. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entry before credit entry.)
Date
Account Titles
Debit
Credit
January 1,2024
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