Carla Vista Corporation, which uses ASPE, manufactures replicators. On May $29,2023,$ it leased to Sheridan Limited a replicator that

cost $$265,600$ to manufacture and usually sells for $$418,000.$ The lease agreement covers the replicator's $8-$year useful life and

requires eight equal annual rentals of $$71,536$ each, beginning May $29,2023.$ The equipment reverts to Carla Vista at the end of the

lease, at which time it is expected that the replicator will have a residual value of $$49,500,$ which is not guaranteed by Sheridan, the

lessee. An interest rate of $12\%$ is implicit in the lease agreement. Collectibility of the rentals is reasonably assured, and there are no

important uncertainties concerning costs.

Click here to view the factor table PRESENT VALUE OF $1.$

Click here to view the factor table PRESENT VALUE OF AN ANNUITY DUE.

Prepare Carla Vista's May $29,2023$ journal entries. $($List all debit entries before credit entries. Credit account titles are automatically

indented when the amount is entered. Do not indent manually. If no entry is required, select $"$No Entry" for the account titles and enter $0$ for the

amounts. Round factor values to $5$ decimal places, e$.$g$.1\mathrm{.}25124$ and final answers to $0$ decimal places, e$.$g$.5,275.)$

Date

May $29$

May $29$

Lease Receivable

Cost of Goods Sold

Sales Revenue

Inventory

Unearned Interest Income

$($To record inception of lease.$)$

May $29$

Debit

Credit