Hughey Co As Lessee Records A Capital Lease Of Machinery On Jan 1 2011 The Seven

Hughey Co. as lessee records a capital lease of machinery on Jan. 1 2011. The seven annual lease payments of $350,000 are made at the end of the year. The present value of the lease payments at 10% is $1,704,000. Hughey uses the effective-interest method of amortization and sum-of-the-years’-digits depreciationPrepare an amortization table for 2011 and 2012Prepare all of Hughyey’s journal entries for 2011.

Date Amortization tableLease payment or rent payment 1st jan. 201131st Dec. 201131st dec. 2012Date1st Jan.201131st Dec.201131st Dec.201131st Dec.2011 Interest @10% 350000350000…

 

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