Brief Exercise 21-06 Waterworld Company leased equipment from Costner Company, beginning on December 31, 2019. The lease term is 4 years and requires equal rental payments of $41,934 at the beginning of each year of the lease, starting on the commencement date (December 31, 2019). The equipment has a fair value at the commencement date of the lease of $150,001, an estimated useful life of 4 years, and no estimated residual value. The appropriate interest rate is 8%. Click here to view factor tables. Prepare Waterworld's 2019 and 2020 journal entries, assuming Waterworld depreciates similar equipment it owns on a straight-line basis. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to o decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit (To record lease liability) (To record lease payment) (To record interest expense) (To record amortization of the right-of-use asset) Brief Exercise 21-10 Assume that IBM leased equipment that was carried at a cost of $120,000 to Swander Company. The term of the lease is 6 years December 31, 2019, with equal rental payments of $30,044 beginning December 31, 2019. The fair value of the equipment at commencement of the lease is $150,001. The equipment has a useful life of 6 years with no salvage value. The lease has an implicit interest rate of 8%, no bargain purchase option, and no transfer of title. Collectibility of lease payments for IBM is probable. Prepare IBM's December 31, 2019, journal entries at commencement of the lease. (Credit account titles are automatically indented when amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to o decimal places e.g. 5,275.) Click here to view factor tables. Debit Credit Date Account Titles and Explanation December 31, 2019 (To record the lease) December 31, 2019 (To record receipt of lease payment)