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A company leases some of the equipment it uses. The lease term is 5 years, and the lease payment are to be made in advance as show in the following schedule:

January 1, 2011 $60,000

January 1, 2012 60,000

January 1, 2013 90,000

January 1, 2014 110,000

January 1, 2015 140,000

$460,000

The equipment is to be used evenly over the 5-year period. For each of the five years, I need to give the entry that should be made at the time the lease payment is made to allocate the proper share of rent expense to each period. the lease is classified as an operating least by the company.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9977957

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