Question

Help me with the errors

On January 1, 2021, Nath-Langstrom Services, Inc., a computer software training firm, leased several computers under a two year operating lease agreement from Computerworld Leasing, which routinely finances equipment for other firms at an annual interest rate of 4%. The contract calls for four rent payments of $19.500 each payable semiannually on June 30 and December 31 each year. The computers were acquired by Computerworld at a cost of $109,000 and were expected to have a useful life of five years with no residual value. Both firms record amortization and depreciation semiannually. (FV of $1. PV of $1. FVA of 51, PVA of $1. FVAD of $1 and PVAD of $1 (Use appropriate factor(s) from the tables provided.) Required: 1. Prepare appropriate journal entries recorded by Nath-Langstrom Services for the first year of the lease. 2. Prepare appropriate journal entries recorded by Computerworld Leasing for the first year of the lease. * Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare appropriate journal entries recorded by Nath-Langstrom Services for the first year of the lease. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. (Round your intermediate calculations and final answers to the nearest whole dollar) No Date General Journal Credit Debit 74.251 January 01, 2021 Right-of-use asset Lease payable 74.251 June 30, 2021 Interest expense Lease payable Cash 1.485 18.015 19.500 June 30, 2021 18,583 Amortization expense Right-of-use asset 18,563 1,125 December 31, 20 interest expense Lease payable Cash 18,375 10,500 18,583 December 31, 204 Amortization expense Right-of-use asset 18,503 X Required 2 >

Answer 1

3. June 30, 2021- Amortization Expenses $18,015

Right-of-use asset $18,015

5. December 31, 2021:- Amortization Expenses $18,375

Right-of-use asset $18,375

Computation of Amortization:- (Amortisation Expense is the amount of Principal Paid)

(A) (B) (A-B) Period Cash Payment Interest Expenses Liability Reduction (Amortization Cost) Liability(Lease) Balance 19500 19500 1485 1125 18015 18375 74251 56236 37861