Homework SourseOn August 1 2016 Alpha Company entered into a capital lease
On August 1, 2016, Alpha Company entered into a capital lease, and correctly recorded the leased asset, and related obligation at $50,000. The annual interest rate implicit in the lease was 6%, and the first lease payment of $2,000 is due at the end of each month of the lease. Use this information to prepare the General Journal entry (without explanation) for the August 31, 2016 monthly lease payment. If no entry is required then write \"No Entry Required.\" (Round your answer to the nearest whole dollar.
Solution
Use this information to prepare the General Journal entry (without explanation) for the August 31, 2016 monthly lease payment.
| Date | accounts & explanation | debit | credit |
| 2016, Aug 31 | Lease Liability | 1750 | |
| Interest payable (50000*6%*1/12) | 250 | ||
| Cash a/c | 2000 | ||
| (To record lease payment) | |||
