Cheyenne Corporation enters into a $5-$year lease of equipment on December $31,2019,$ which requires $5$ annual payments of

$$37,800$ each, beginning December $31,2019.$ In addition, Cheyenne guarantees the lessor a residual value of $$20,500$ at the

end of the lease. However, Cheyenne believes it is probable that the expected residual value at the end of the lease term will be

$$10,250.$ The equipment has a useful life of $5$ years.

Prepare Cheyennes' December $31,2019,$ journal entries assuming the implicit rate of the lease is $10\%$ and this is known to

Cheyenne. $($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 $0$ decimal places e$.$g$.5,275.$

Click here to view factor tables.

Date

Account Titles and Explanation

December

$31,2019$

Debit

Credit

$($To record the lease liability$)$

December

$31,2019$

Help please