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Prepare the appropriate entries for MS

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MS leased a Cloud Computing equipment from Academy Leasing Services on January l, 2019. Academy Leasing Services paid $454,595 for the equipment. Its fair value is $454,595. Terms of the Lease Agreement and Related Information are as below.

Lease term:                              5 years

Semiannual lease payments:       $ 100,000 at beginning of each period

Economic life of asset:              5 years

Annual interest rate:                 5%

Required:

Question a. Prepare amortization schedule that shows the pattern of interest expense for MS.

Question b. Prepare the appropriate entries for 2019 for MS.

Reference no: EM132467642

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