Carla Vista Company, as lessee, enters into a lease agreement on July 1, 2021, for equipment. The following data are relevant to the lease agreement:

1. The term of the noncancelable lease is 4 years, with no renewal option. Payments of $891,784 are due on July 1 of each year.

2. The fair value of the equipment on July 1, 2021 is $3,190,000. The equipment has an economic life of 6 years with no salvage value.

3. Carla Vista depreciates similar machinery it owns on the sum-of-the-years'-digits basis.

4. The lessee pays all executory costs.

5. Carla Vista's incremental borrowing rate is 10% per year. The lessee is aware that the lessor used an implicit rate of 8% in computing the lease payments. a) indicate the type of lease Carla Vista Company has entered into and what accounting treatment is applicable.

Prepare the journal entries for Carla Vista's books that relate to the lease agreement for the followin dates :

1. July 1, 2021

2. December 31, 2021.

3. July 1, 2022.

4. December 31, 2022.

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Prepare the journal entries on Carla Vista's books that relate to the lease agreement for the following dates: (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round present value factor calculations to 5 decimal places, eg. 1.25124 and the final answer to 0 decimal places eg. 5,250.) 1. July 1,2021. 2. December 31, 2021. 3. July 1,2022. 4. December 31, 2022 . Prepare the journal entries on Carla Vista's books that relate to the lease agreement for the following dates: (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round present value factor calculations to 5 decimal places, eg. 1.25124 and the final answer to 0 decimal places eg. 5,250.) 1. July 1,2021. 2. December 31, 2021. 3. July 1,2022. 4. December 31, 2022