Wildhorse Corporation, which uses ASPE, manufactures replicators. On May 29, 2020, it leased to Bramble Limited a replic

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Wildhorse Corporation, which uses ASPE, manufactures
replicators. On May 29, 2020, it leased
to Bramble Limited a replicator that cost
$267,000 to manufacture and usually sells for $421,000. The
lease agreement covers the replicator’s 8-year useful life and
requires eight equal annual rentals of $72,394 each,
beginning May 29, 2020. The equipment reverts
to Wildhorse at the end of the lease, at which time it is
expected that the replicator will have a residual value of $45,100,
which is not guaranteed by Bramble, the lessee. An interest
rate of 12% is implicit in the lease agreement. Collectibility
of the rentals is reasonably assured, and there are no important
uncertainties concerning costs.

Click here to view the factor table PRESENT VALUE OF 1.
Click here to view the factor table PRESENT VALUE OF AN ANNUITY
DUE.

Prepare Wildhorse’s May 29, 2020 journal
entries. (Credit account titles are automatically
indented when the amount is entered. Do not indent manually.
If no entry is required, select "No Entry" for the account titles
and enter 0 for the amounts. Round factor values to 5 decimal
places, e.g. 1.25124 and final answers to 0 decimal places, e.g.
5,275.)
Date
Account Titles and Explanation
Debit
Credit
May 29
enter an account title to record inception of lease
enter a debit amount
enter a credit amount
enter an account title to record inception of lease
enter a debit amount
enter a credit amount
enter an account title to record inception of lease
enter a debit amount
enter a credit amount
enter an account title to record inception of lease
enter a debit amount
enter a credit amount
enter an account title to record inception of lease
enter a debit amount
enter a credit amount
(To record inception of lease.)
May 29
enter an account title to record the Collection of first lease
payment
enter a debit amount
enter a credit amount
enter an account title to record the Collection of first lease
payment
enter a debit amount
enter a credit amount
(Collection of first lease payment.)