Question

I'm having trouble with the general journal entries. Can you help me with them?

Manufacturers Southern leased high-tech electronic equipment from Edison Leasing on January 1, 2018. Edison purchased the equipment from International Machines at a cost of $117,772. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

Manufacturers Southern leased high-tech electronic equipment from Edison Leasing on January 1, 2018. Edison purchased the equipment from International Machines at a cost of $117,772. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Related Information: Lease term 2 years (8 quarterly periods) Quarterly rental payments $15,500 at the beginning of each period Economic life of asset 2 years Fair value of asset $117,772 Implicit interest rate 6% (Also lessee’s incremental borrowing rate) Required: Prepare a lease amortization schedule and appropriate entries for Manufacturers Southern from the beginning of the lease through January 1, 2019. Depreciation is recorded at the end of each fiscal year (December 31) on a straight-line basis.

Required:
Prepare a lease amortization schedule and appropriate entries for Manufacturers Southern from the beginning of the lease through January 1, 2019. Depreciation is recorded at the end of each fiscal year (December 31) on a straight-line basis.

No	Date	General Journal	Debit	Credit
1	January 01, 2018	Equipmentselected answer incorrect	117,772selected answer correct	not attempted
		Lease payableselected answer correct	not attempted	117,772selected answer correct
2	January 01, 2018	Lease expenseselected answer incorrect	15,500selected answer correct	not attempted
		Cashselected answer correct	not attempted	15,500selected answer correct
3	April 01, 2018	Lease expenseselected answer incorrect	14,175selected answer incorrect	not attempted
		Interest expenseselected answer correct	1,112selected answer incorrect	not attempted
		Cashselected answer correct	not attempted	15,500selected answer correct
4	July 01, 2018	Lease expenseselected answer incorrect	15,045selected answer incorrect	not attempted
		Interest expenseselected answer correct	455selected answer incorrect	not attempted
		Cashselected answer correct	not attempted	15,500selected answer correct
5	October 01, 2018	No journal entry requiredselected answer incorrect	not attempted	not attempted
6	December 31, 2018	Depreciation expenseselected answer incorrect	58,886selected answer incorrect	not attempted
		Equipmentselected answer incorrect	not attempted	58,886selected answer incorrect
7	December 31, 2018	No Transaction Recorded

Answer 1

IF YOU HAVE ANY DOUBTS COMMENT BELOW I WILL BE TTHERE TO HELP YOU..ALL THE BEST..

AS FOR GIVEN DATA..

Manufacturers Southern leased high-tech electronic equipment from Edison Leasing on January 1, 2018. Edison purchased the equipment from International Machines at a cost of $117,772. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)(Use appropriate factor(s) from the tables provided.) Related Information: Lease term 2 years (8 quarterly periods) Quarterly rental payments $15,500 at the beginning of each period Economic life of asset 2 years Fair value of asset $117,772 Implicit interest rate 6% (Also lessee’s incremental borrowing rate) Required: Prepare a lease amortization schedule and appropriate entries for Manufacturers Southern from the beginning of the lease through January 1, 2019. Depreciation is recorded at the end of each fiscal year (December 31) on a straight-line basis.

Required:
Prepare a lease amortization schedule and appropriate entries for Manufacturers Southern from the beginning of the lease through January 1, 2019. Depreciation is recorded at the end of each fiscal year (December 31) on a straight-line basis.

No	Date	General Journal	Debit	Credit
1	January 01, 2018	Equipmentselected answer incorrect	117,772selected answer correct	not attempted
		Lease payableselected answer correct	not attempted	117,772selected answer correct
2	January 01, 2018	Lease expenseselected answer incorrect	15,500selected answer correct	not attempted
		Cashselected answer correct	not attempted	15,500selected answer correct
3	April 01, 2018	Lease expenseselected answer incorrect	14,175selected answer incorrect	not attempted
		Interest expenseselected answer correct	1,112selected answer incorrect	not attempted
		Cashselected answer correct	not attempted	15,500selected answer correct
4	July 01, 2018	Lease expenseselected answer incorrect	15,045selected answer incorrect	not attempted
		Interest expenseselected answer correct	455selected answer incorrect	not attempted
		Cashselected answer correct	not attempted	15,500selected answer correct
5	October 01, 2018	No journal entry requiredselected answer incorrect	not attempted	not attempted
6	December 31, 2018	Depreciation expenseselected answer incorrect	58,886selected answer incorrect	not attempted
		Equipmentselected answer incorrect	not attempted	58,886selected answer incorrect
7	December 31, 2018	No Transaction Recorded

Manufacutrers Southern
Lease Amortisation Schedule
Implicit Interest Rates	6%
Fair value of Leased		$                 117,772
Date	Lease Payment	effective Interest	Decrease in Balance	Lease in Balance
01/01/2018	$              15,500.00	$                             -	$                       15,500	$                 102,272
01/04/2018	$              15,500.00	$                      1,534	$                       13,966	$                    88,306
01/07/2018	$              15,500.00	$                      1,325	$                       14,175	$                    74,131
01/10/2018	$              15,500.00	$                      1,112	$                       14,388	$                    59,743
01/01/2019	$              15,500.00	$                          896	$                       14,604	$                    45,139
01/04/2019	$              15,500.00	$                          677	$                       14,823	$                    30,316
01/07/2019	$              15,500.00	$                          455	$                       15,045	$                    15,271
01/10/2019	$              15,500.00	$                          229	$                       15,271	$                            (0)
Total	$           124,000.00	$                      6,228	$                    117,772	$                 124,000

General Journal
Manufacutrers Southern
Date	General Journal	Debit	Credit
01/01/2018	Equippmen on Lease	$        117,772
	To, Edison Leasing		$        117,772
	(Being Equipment taken on lease recognised at fair value of assets and liability recorded)
01/01/2018	Edison Leasing A/c…Dr	$          15,500
	To, Bank A/c		$          15,500
	(Being Lease rental paid to Edison leasing at begining)
	Finance charge on 1st rental is Nil
	(No Entries to be made)
01/04/2018	Edison Leasing A/c…Dr	$          13,966
	Finance Charge on Lease Rental A/c..Dr	$             1,534
	To, Bank A/c		$          15,500
	(Being Lease Rental Paid to Edison leasing )
01/07/2018	Edison Leasing A/c…Dr	$          14,175
	Finance Charge on Lease Rental A/c..Dr	$             1,325
	To, Bank A/c		$          15,500
	(Being Lease Rental Paid to Edison leasing )
01/10/2018	Edison Leasing A/c…Dr	$          14,388
	Finance Charge on Lease Rental A/c..Dr	$             1,112
	To, Bank A/c		$          15,500
	(Being Lease Rental Paid to Edison leasing )
31/12/2018	Depreciation on Equipment on Lease A/c..Dr	$          58,886
	To, Equipment on Lease A/c		$          58,886
	(Being depreciation on equipment on lease recognised as per SLM Basis)
31/12/2018	Statement of Profit or Loss A/c…Dr	$          62,857
	To, Finance Charge A/c		$             3,971
	To, Depreciation on Equipment on Lease A/c		$          58,886
	(Being Amount transferred to Statement of Profit or Loss A/c)
01/01/2019	Edison Leasing A/c…Dr	$          14,604
	Finance Charge on Lease Rental A/c..Dr	$                896
	To, Bank A/c		$          15,500
	(Being Lease Rental Paid to Edison leasing )
01/04/2019	Edison Leasing A/c…Dr	$          14,823
	Finance Charge on Lease Rental A/c..Dr	$                677
	To, Bank A/c		$          15,500
	(Being Lease Rental Paid to Edison leasing )
01/07/2019	Edison Leasing A/c…Dr	$          15,045
	Finance Charge on Lease Rental A/c..Dr	$                455
	To, Bank A/c		$          15,500
	(Being Lease Rental Paid to Edison leasing )
01/10/2019	Edison Leasing A/c…Dr	$          15,271
	Finance Charge on Lease Rental A/c..Dr	$                229
	To, Bank A/c		$         15,500
	(Being Lease Rental Paid to Edison leasing )
31/12/2019	Depreciation on Equipment on Lease A/c..Dr	$          58,886
	To, Equipment on Lease A/c		$          58,886
	(Being depreciation on equipment on lease recognised as per SLM Basis)
31/12/2019	Statement of Profit or Loss A/c…Dr	$          61,143
	To, Finance Charge A/c		$             2,257
	To, Depreciation on Equipment on Lease A/c		$          58,886
	(Being Amount transferred to Statement of Profit or Loss A/c)

I HOPE YOU UNDERSTAND..

PLS RATE THUMBS UP..ITS HELPS ME ALOT..

THANK YOU...!!