Question 6 (8 points)
On August 1, 2016, Alpha Company entered into a capital lease, and correctly recorded the leased asset, and related obligation at $50,000. The annual interest rate implicit in the lease was 12%, and the first lease payment of $2,000 is due at the end of each month of the lease. Use this information to prepare the General Journal entry (without explanation) for the August 31, 2016 monthly lease payment. If no entry is required then write “No Entry Required.”(Round your answer to the nearest whole dollar.)
Question 7 (4 points)
Alpha company purchased a bond investment on January 1, 2017. The bonds have a par of $10,000, pay interest at a 4% annual rate and have 5 years until maturity. What is the total Interest Income that will be reported over the life of the bond investment if the bonds were purchased at 102 and Alpha uses the straight line amortization method?