Assume that on December 31, 2019, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement.

1.		The agreement requires equal rental payments of $66,399 beginning on December 31, 2019.
2.		The fair value of the building on December 31, 2019 is $485,586.
3.		The building has an estimated economic life of 12 years, a guaranteed residual value of $9,500, and an expected residual value of $7,200. Kimberly-Clark depreciates similar buildings on the straight-line method.
4.		The lease is nonrenewable. At the termination of the lease, the building reverts to the lessor.
5.		Kimberly-Clarks incremental borrowing rate is 8% per year. The lessors implicit rate is not known by Kimberly-Clark.

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Prepare the journal entries on the lessees books to reflect the signing of the lease agreement and to record the payments and expenses related to this lease for the years 2019, 2020, and 2021. Kimberly-Clarks fiscal year-end is December 31. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places e.g. 5,275.)

Debit Credit 485586 Date Account Titles and Explanation 12/31/19+ Right-of-Use Asset Lease Liability (Tu record these 12/31/19: Lease Liability (Ta record is loan Daviment) (Tu record amortization of the night-of-use asset) To record interest me) (Ta record amortization of the right of use asset) (Tu record interest expense) Textbook and Media List of Accounts Suppose the same facts as above, except that Kimberly-Clark incurred legaltees resulting from the execution of the lease of $5,000 and received a lease incentive from Sheffield to enter the lease of $1.000. How would the initial measurement of the lease liability and right-of-use asset be affected under this stuation! Right-of-un act $ e Textbook and Media List of Accounts Suppose that in addition to the $66,399 annual rental $275J mberly Clark is also required to pay $5.000far insurance to theksser, Scheid Storage. How would thicctory cost kollability and right of w ood , Lease ability s Textbook and Media Ust of Accounts control of the orase builn to Shuthadumine the NON uppose that at the end of the lease term. Kimberly-Clark took good care of the asset and Shetheld agrees that the fair value been made Credit accountles are automatically idended when the amount is entered. Do not indentmonly Account Titles and Explanation Debit Credit