Function: PV$,$ SLN; Formula: Subtract; Cell Referencing

Using Excel to Account for Lease for the Lessee

PROBLEM

Rick Kleckner Corporation recorded a right$-$of$-$use asset as a result of a finance lease on December $31,2024.$ Kleckner was not aware of the implicit rate of the lessor at the commencement of the lease.

Kleckner made the first lease payment on December $31,2024.$ The lease requires annual payments. The equipment has no residual value. Additional information concerning the lease is provided here.

Right$-$of$-$use asset

Annual lease payments

Residual value of leased asset

Lease term in years

Useful life of leased equipment in years

Kleckner's incremental borrowing rate

Student Work Area

Required: Provide input into cells shaded in yellow in this template. Input the required mathematical formulas or functions with cell references to the Problem area or work area as indicated.

Use the PV function to determine the amount at which the lease is recorded. Prepare Kleckner's December $31,2025,$ entries. List debit accounts alphabetically.

Amount at which the lease is recorded