Prepare Lost Arks 2016 and 2017 journal entries, assuming the implicit rate of the lease is 6% and this is known to Indiana Jones.
Indiana Jones Corporation enters into a 6-year lease of equipment on December 31, 2016, which requires 6 annual payments of $40,000 each, beginning December 31, 2016. In addition, Indiana Jones guarantees the lessor a residual value of $20,000 at the end of the lease. However, Indiana Jones believes it is probable that the expected residual … Read more