Rick Kleckner Corporation recorded a capital lease at $297,360 on January 1, 201

Question

Rick Kleckner Corporation recorded a capital lease at $297,360 on January 1, 2012. The interest rate is 12%. Kleckner Corporation made the first lease payment of $53,446 on January 1, 2012. The lease requires eight annual payments. The equipment has a useful life of 8 years with no salvage value. Assume that at December 31, 2012, Kleckner made an adjusting entry to accrue interest expense of $29,270 on the lease. Prepare Kleckner's January 1, 2013, journal entry to record the second lease payment of $53,446.

Explanation / Answer

for second lease Payment Lessor A/c 53446 To bank 53446 Interest A/c To Lessor

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