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We just recently purchased a laptop under a buyout lease after 24 months. I want to add to equipment under assets. But I am not sure how to also account for the lease payments. Do they become a liability, and would interest become an expense.

Any help would be great.

The lease payments will not start till February

A liability would work for the lease payments.

Acquire laptop:
DB 01-1810-000 laptop computer
CR 01-2480-000 laptop lease

Make a payment:
CR 01-1110-000 checking
DB 01-2480-000 laptop lease

Buyout:
CR 01-1110-000 checking
DB 01-1810-000 laptop computer

If you want to show depreciation:
CR 01-1890-000 depreciation reserve (this will be a negative amout)
DB 01-5890-000 depreciation expense

Thanks John

That is perfect.