On January 1, 2021, Taco King leased retail space from Fogelman Properties. The 10-year finance lease requires quarterly variablelease payments equal to 3% of Taco King's sales revenue, with a quarterly sales minimum of $520,000. Payments at the beginning ofeach quarter are based on previous quarter sales. During the previous 5-year period, Taco King has generated quarterly sales of over$710,000. Fogelman's interest rate, known by Taco King, was 4%. ( EV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $1)(Use appropriate factor(s) from the tables provided.)Required:1. Prepare the journal entries for Taco King at the beginning of the lease at January 1, 2021.2. Prepare the journal entries for Taco King at April 1, 2021. First quarter sales were $720,000. Amortization is recorded quarterlyAnswer is not complete.Complete this question by entering your answers in the tabs below.Required 11 Required 2Prepare the journal entries for Taco King at the beginning of the lease at January 1, 2021. (If no entry is required for atransaction/event, select "No journal entry required" in the first account field. Round your answers to the nearest whole dollaramount.)No12Required 1NoDateJanuary 01, 2021 Right-of-use assetLease payable1January 01, 2021 Lease payableCash2Required 200000000DateApril 01, 2021April 01, 2021Interest expenseLease expenseLease payableCashGeneral JournalPrepare the journal entries for Taco King at April 1, 2021. First quarter sales were $720,000. Amortization is recordedquarterly. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Roundyour answers to the nearest whole dollar amount.)General JournalAmortization expenseRight-of-use asset✔→ⒸDebit0000 0015,600CreditDebit15.600✔Credit

Introduction: A journal entry is used to record a business transaction in the accounting records of…

On January 1, 2021, Taco King leased retail space from Fogelman Properties. The 10-year finance lease requires quarte lease payments equal to 3% of Taco King's sales revenue, with a quarterly sales minimum of $520,000. Payments at the beginning of each quarter are based on previous quarter sales. During the previous 5-year period, Taco King has generated quarterly sales of over $710.000 Fogelman's interest rate, known by Taco King, was 4%. ( EV of $1. PV of $1. EVA of $1. PVA of $1. EVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Prepare the journal entries for Taco King at the beginning of the lease at January 1, 2021. 2. Prepare the journal entries for Taco King at April 1, 2021. First quarter sales were $720,000. Amortization is recorded quarterly Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the journal entries for Taco King at the beginning of the lease at January 1, 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to the nearest whole dollar amount.) No 1 2 No 1 Date January 01, 2021 Right-of-use asset Lease payable 2 January 01, 2021 Lease payable Cash Required 2 Date April 01, 2021 April 01, 2021 General Journal Required 1 Prepare the journal entries for Taco King at April 1, 2021. First quarter sales were $720,000. Amortization is recorded quarterly. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to the nearest whole dollar amount.) General Journal Interest expense Lease expense Lease payable Cash O Amortization expense Right-of-use asset Debit 9000 00 15,600 Credit Debit 15,600 Credit

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter19: Lease And Intermediate-term Financing

Section: Chapter Questions

Problem 16P