On January 1 of the Current Year, Fields Corporation Leased $\begin{array}{lrr} \text { Cash } &72,0000\\ \text { Lease Receivable} &&72,000\\\end{array}$

Multiple Choice

On January 1 of the current year, Fields Corporation leased a machine from Kilmer Company. The machine originally cost Kilmer $500,000. The lease is an operating lease that requires for five annual payments of $72,000 beginning on January 1 of the current year. Which of the following journal entries should Kilmer record on January 1 of the current year?

A) $\begin{array}{lrr} \text { Cash } &72,0000\\ \text { Lease Receivable} &&72,000\\\end{array}$

B) $\begin{array}{lrr} \text { Cash } &72,00\\ \text { Unearned Rent Revenue } &&72,000\\\end{array}$

C) $\begin{array}{lrr} \text { Cash} &72,000\\ \text { Rent Revenue } &&72,000\\\end{array}$

D) $\begin{array}{lrr} \text {Cash } &72,000\\ \text { Rent Expense } &&72,000\\\end{array}$