Question: b. PRIMAX BHD signed a five-year contract to lease a machinery to LM BHD on 1 January 2020. The contract requires LM BHD. to make

b. PRIMAX BHD signed a five-year contract to lease a machinery

b. PRIMAX BHD signed a five-year contract to lease a machinery to LM BHD on 1 January 2020. The contract requires LM BHD. to make an annual payment of RM18,000 on the signing date and subsequently on 31 December every year. LM BHD has guaranteed RM8,000 on the residual value. The machinery was purchased at RM100,000 on 1 January 2019 with an estimated residual value of RM10,000 and useful life of seven years. i. Assuming the implicit rate is 8 percent, show the journal entry on 1 January 2020 for PRIMAX BHD. (4 marks) ii. Show all the journal entries on 31 December 2020 related to the lease for PRIMAX BHD

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