On January 1 of the current year,Stephens Corporation leased machinery from Montgomery Company.The machine originally cost Montgomery $250,000.The lease agreement is an operating lease,the terms of which call for five annual payments of 25,000.The first payment is due at the inception of the lease; the other three payments are due on January 1 of subsequent years.What journal entry should Stephens make on January 1 of the current year?
A)

B)

C)

D)

Question

On January 1 of the current year,Stephens Corporation leased machinery from Montgomery Company.The machine originally cost Montgomery $250,000.The lease agreement is an operating lease,the terms of which call for five annual payments of 25,000.The first payment is due at the inception of the lease; the other three payments are due on January 1 of subsequent years.What journal entry should Stephens make on January 1 of the current year?
A)

B)

C)

D)

Quizplus · Accepted Answer

The Answer of On January 1 of the current year,Stephens Corporation leased machinery from Montgomery Company.The machine originally cost Montgomery $250,000.The lease agreement is an operating lease,the terms of which call for five annual payments of 25,000.The first payment is due at the inception of the lease; the other three payments are due on January 1 of subsequent years.What journal entry should Stephens make on January 1 of the current year?

On January 1 of the Current Year,Stephens Corporation Leased Machinery