Eye Deal Optometry leased vision-testing equipment from Insight Machines on January 1, 2021. Insight Machines manufactured the equipment at a cost of $200,000 and lists a cash selling price of $250,177. Appropriate adjusting entries are made quarterly.

Related Information:
Lease term ........................................5 years (20 quarterly periods)
Quarterly lease payments ..............$15,000 at Jan. 1, 2021, and at Mar. 31, June 30,Sept. 30, and Dec. 31 thereafter
Economic life of asset ........................5 years
Interest rate charged by the lessor ...8%

Required:
1. Prepare appropriate entries for Eye Deal to record the arrangement at its beginning, January 1, 2021, and on March 31, 2021.
2. Prepare appropriate entries for Insight Machines to record the arrangement at its beginning, January 1, 2021, and on March 31, 2021.