Recording SalesType Lease Journal EntriesNo Residual Value
Franklin Co leased its manufactured equipment to Parker Inc. for a fouryear term. Franklin Co reported a book value of $ for the equipment in its inventory account. The lease commenced on January with the first annual payment of $ due immediately. The equipment has a useful life of four years, an estimated fair value of $ and no residual or salvage value. The implicit rate of the lease is and collectibility of the lease payments from Parker is probable.
Record Franklin's journal entries at the commencement of the salestype lease for the lease receivable and receipt of the first payment.
Note: Round your answers to the nearest whole dollar.
tableDateAccount Name,Dr Jan. Lease Receivable,Cost of Goods Sold,Sales Revenue,InventoryTo derecognize asset and record investment in lease,, Jan. Cash,Lease Receivable,To record cash lease payment,,
