Prepare the general journal entries over the life of lease

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Problem - On 1 January 2019, Lessor Ltd leased a truck with an estimated economic life of five years to Cubic-Haul Ltd for a period of five years. Cubic-Haul Ltd agreed to pay annual rentals of $12 000 commencing with the first payment on 1 January 2019. The unguaranteed full residual value of the truck at the end of the lease is $4 000. The interest rate implicit in the lease is 8%. Prepare the general journal entries over the life of the lease in the accounts of Cubic-Haul Ltd.

Reference no: EM132793638

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