On June Steady Consulting signed a lease on electronic office equipment for three years. At the end of the lease Steady has the option to purchase the equipment for $ Lease payments are to be $ per month with payment due the st of the month. The implied interest rate is and the present value of the lease payments is $ As part of the lease term Steady will be billed an additional $ per month for a maintenance contract. Give the journal entries related to the lease for June and July The st payment will be June Depreciation will be recorded at year end only.

b Assuming straight line and no salvage value and a year useful life, what is the depreciation expense on the leased equipment at December