Answer and Explanation:
The journal entries are shown below:
1. Right of use assets$350,000 ($56,394 × 6.2064)
To lease liability $350,000
(Being the lease liability is recorded)
Refer to the present value annuity due factor table for 6.2064
2. Lease liability $56,394
To cash $56,394
(being cash paid is recorded)
3. Lease liability $32,905
Interest expense $23,489 {($350,000 - $56,394) × 8%}
To Cash $56,394
(Being cash paid is recorded)
4. Amortization expense $43,750 {$350,000 ÷ 8 years)
To Right of use asset $43,750
(Being the amortization expense is recorded)
