Cheyenne Corporation leases equipment from Falls Company on January $1,2025.$ The lease agreement does not transfer ownership.

contain a bargain purchase option, and is not a specialized asset. It covers $3$ years of the equipment's $8-$year useful life, and the present

value of the lease payments is less than $90\%$ of the fair value of the asset leased.

Prepare Cheyenne's joumal entries on January $1,2025,$ and December $31,2025.$ Assume the annual lease payment is $$43,000$ at the

beginning of each year, and Cheyenne's incremental borrowing rate is $6\%,$ which is the same as the lessor's implicit rate. $($List all debit

entries before credit entries. 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 $0$ decimal places, e$.$g$.5,265.$ If no

entry is required, select $"$No Entry" for the account titles and enter O for the amounts. Record journal entries in the order presented in the

problem.$)$

Click here to view factor tables.

$($To record lease liability$)$

$($To record lease payment$)$