Prepare marin journal entries

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Problem - Marin Company leased equipment from Costner Company, beginning on December 31, 2019. The lease term is 8 years and requires equal rental payments of $56,394 at the beginning of each year of the lease, starting on the commencement date (December 31, 2019). The equipment has a fair value at the commencement date of the lease of $350,000, an estimated useful life of 8 years, and no estimated residual value. The appropriate interest rate is 8%.

Required - Prepare Marin's 2019 and 2020 journal entries, assuming Marin depreciates similar equipment it owns on a straight-line basis.

Reference no: EM132654315

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