Journal transactions to record the lease

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Question - Hughey Co as lessee records a finance lease of machinery on January 1, 2018. The seven annual lease payments of $700,300 are made at the end of each year. The present value of the lease payments at 9% is $3,409,900. Hughey uses the effective-interest method of amortization and sum-of-the-year's-digits depreciation (no residual value).

Required - How do prepare the amortization table for 2018 and 2019 and journal these transactions to record the lease, the first lease payment, and to record depreciation?

Reference no: EM132620828

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