Prepare nashs december journal entries

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Question - Nash Corporation enters into a 5-year lease of equipment on December 31, 2019, which requires 5 annual payments of $36,000 each, beginning December 31, 2019. In addition, Nash guarantees the lessor a residual value of $19,900 at the end of the lease. However, Nash believes it is probable that the expected residual value at the end of the lease term will be $9,950. The equipment has a useful life of 5 years.

Prepare Nashs' December 31, 2019, journal entries assuming the implicit rate of the lease is 10% and this is known to Nash.

Reference no: EM133182536

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