Frankel Forges, Inc., an IFRS reporter, leases a high-capacity forge from Bleake Metal Works Company for total

Question:

Frankel Forges, Inc., an IFRS reporter, leases a high-capacity forge from Bleake Metal Works Company for total lease payments of $4,200, which is the fair value of the asset. Under the terms of the agreement, Frankel will make equal payments over the 42-month rental period. The journal entry made each month by Frankel is:

a Rent Expense 100 Cash 100 b Rent Expense 4,200 4,200 Cash c Prepaid rent 4 200 Cash 4.200 d. Leased Asset 100 100 Cash