From Bentley's perspective, provide the journal entries for the following:

1. At lease inception on January 1, Year 1

1. When the first lease payment is made on June 30, Year 1

1. When the second lease payment is made on December 31, Year 1

1. Determine the interest paid over the life of the lease.

From Acwen's perspective, provide the journal entries for the following:

1. At lease inception on January 1, Year 1

1. When the first lease payment is made on June 30, Year 1

1. When the second lease payment is made on December 31, Year 1

1. Determine the interest income received over the life of the lease.

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Acwen Corp. is a U.S. company that owns equipment that is regularly leased to construction companies. Bentley Inc. is the lessee on a new four-year lease, which qualifies as an FINANCE LEASE for both parties. Lease Agreement [Excerpts] This Lease Agreement ("Agreement") is entered into by and between Acwen Corp. ("Lessor"), and Bentley Inc. ("Lessee"). Lessor and Lessee are collectively referred to in this Agreement as the "Parties." This Agreement shall be effective as of the date executed by the Lessor, as set forth below. For the covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows: 1. Asset: The leased assets shall be equipment leased by the Lessee and leased from the Lessor. Lessor leases the assets to the Lessee on the terms and conditions set forth herein. The equipment has a carrying value of $200,000 at the time of the lease, a useful life of FOUR (4) years, and no salvage value. 2. Term: The term of this Agreement shall be a period of four (4) years, beginning on January 1, Year 1, and ending on December 31, Year 4. Any holding over after the expiration or earlier termination of the term without Lessor's prior written consent shall be a default of this Agreement. 5. Lease Value/Semiannual Payments: The lease payments to be paid by Lessee to the Lessor will be thirty thousand dollars ($30,000) every six months for the duration of the lease, with payments to be made on June 30 and December 31 each year. 12. Entire Agreement: This document constitutes the entire agreement and may be modified or amended only by written agreement signed by both parties. There are no oral agreements between the Parties. Present Value Factors PV of an annuity of $1 at 4.35% for 4 periods PV of an annuity of $1 at 2.175% for 8 periods PV of $1 at 4.35% for 4 periods PV of $1 at 2.175% for 8 periods 3.60015 7.27053 0.84339 0.84187 Acwen Corp. is a U.S. company that owns equipment that is regularly leased to construction companies. Bentley Inc. is the lessee on a new four-year lease, which qualifies as an FINANCE LEASE for both parties. Lease Agreement [Excerpts] This Lease Agreement ("Agreement") is entered into by and between Acwen Corp. ("Lessor"), and Bentley Inc. ("Lessee"). Lessor and Lessee are collectively referred to in this Agreement as the "Parties." This Agreement shall be effective as of the date executed by the Lessor, as set forth below. For the covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows: 1. Asset: The leased assets shall be equipment leased by the Lessee and leased from the Lessor. Lessor leases the assets to the Lessee on the terms and conditions set forth herein. The equipment has a carrying value of $200,000 at the time of the lease, a useful life of FOUR (4) years, and no salvage value. 2. Term: The term of this Agreement shall be a period of four (4) years, beginning on January 1, Year 1, and ending on December 31, Year 4. Any holding over after the expiration or earlier termination of the term without Lessor's prior written consent shall be a default of this Agreement. 5. Lease Value/Semiannual Payments: The lease payments to be paid by Lessee to the Lessor will be thirty thousand dollars ($30,000) every six months for the duration of the lease, with payments to be made on June 30 and December 31 each year. 12. Entire Agreement: This document constitutes the entire agreement and may be modified or amended only by written agreement signed by both parties. There are no oral agreements between the Parties. Present Value Factors PV of an annuity of $1 at 4.35% for 4 periods PV of an annuity of $1 at 2.175% for 8 periods PV of $1 at 4.35% for 4 periods PV of $1 at 2.175% for 8 periods 3.60015 7.27053 0.84339 0.84187

Answer rating: 100% (QA)

Journal Entries for Bentley Lessee At Lease Inception January 1 Year 1 Debit RightofUse Asset 214064 Credit Lease Liability 214064 Calculation Present ... View the full answer