Prepare Oriole journal entries

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Question - On January 1, 2020, Oriole Ltd., which uses ASPE, sold a truck to Sheridan Finance Corp. for $77,000 and immediately leased it back. The truck was carried on Oriole's books at $62,000, net of $30,500 of accumulated depreciation. The term of the lease is five years, and title transfers to Oriole at lease end. The lease requires five equal rental payments of $20,834, with each payment made at year end. The appropriate rate of interest is 11%, and the truck has a useful life of five years with no salvage value. Prepare Oriole's 2020 journal entries including any year-end adjusting entries at December 31, 2020.

Reference no: EM133017101

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