Question: (5 points) On 12-31-19, C leased a machine with a useful life of 10 years. The noncancelable lease agreement required C to make 3 annual

  1. (5 points) On 12-31-19, C leased a machine with a useful life of 10 years. The noncancelable lease agreement required C to make 3 annual lease payments of $50,000 starting 12-31-19. After making the last lease payment, C will return the machine to the lessor on 12-31-22. Cs borrowing rate on 12-31-19 was 5%. C uses a straight-line depreciation method (no residual value) and only prepares AJEs every December 31. Using current GAAP rules, determine if this is a short-term or a long-term lease; IF its a long-term lease, then determine if this is a long-term finance lease OR a long-term operating lease, prepare the lease-related entries C should make on:
  1. December 31, 2019
  2. December 31, 2020
  3. December 31, 2021
  4. December 31, 2022

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