Blossom Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2020. The lease is for an 8-year period and requires equal annual payments of $24,300 at the beginning of each year. The first payment is received on January 1, 2020. Blossom had purchased the machine during 2019 for $160,000. Collectibility of lease payments by Blossom is probable. Blossom set the annual rental to ensure a 5% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Blossom at the termination of the lease. Assume that Dexter Corporation does not know the rate implicit in the lease used by Blossom, and Dexter's incremental borrowing rate is 7%. In addition, assume that Dexter incurs initial direct costs of $19,000. Date Account Titles and Explanation Debit Credit 1/1/20 Lease Receivable 155258 Cost of Goods Sold Sales Revenue (To record the lease) 1/1/20 Sales Revenue Cash (To record the first lease payment) 1/1/20 Cash Lease Receivable (To record interest expense) 12/31/20 Lease Receivable Interest Revenue (To record amortization of the right-of-use asset)