(Solved): On January 1, 2025, Nash Company contracts to lease equipment for 5 years, agreeing to make a paymen ...

On January 1, 2025, Nash Company contracts to lease equipment for 5 years, agreeing to make a payment of \( \$ 133,264 \) at the beginning of each year, starting January 1, 2025. The leased equipment is to be capitalized at \( \$ 565,000 \). The asset is to be amortized on a double-declining-balance basis, and the obligation is to be reduced on an effective-interest basis. Nash's incremental borrowing rate is \( 10 \% \), and the implicit rate in the lease is \( 9 \% \), which is known by Nash. Title to the equipment transfers to Nash at the end of the lease. The asset has an estimated useful life of 5 years and no residual value. Click here to view factor tables. (b) Prepare the journal entries for amortization of the leased asset and interest expense for 2025