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Crane Steel Company, as lessee, signed a lease agreement for equipment for 5 years, beginning December 31,2025 . Annual rental payments of $46,000 are to

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Crane Steel Company, as lessee, signed a lease agreement for equipment for 5 years, beginning December 31,2025 . Annual rental payments of $46,000 are to be made at the beginning of each lease year (December 31 ). The interest rate used by the lessor in setting the payment schedule is 4%; Crane's incremental borrowing rate is 6%. Crane is unaware of the rate being used by the lessor. At the end of the lease, Crane has the option to buy the equipment for $5,000, considerably below its estimated falt value at that time. The equipment has an estimated useful life of 7 years, with no salvage value. Crane uses the straight-line method of depreciation on similar owned equipment. Prepare the journal entries, that Crane should record on December 31, 2025. (Credit account titles are automatically indented when 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 present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answers to 0 decimal places, e.8. 58,971. List all debit entries before credit entries.) Prepare the journal entries, that Crane should record on December 31, 2026. (Credit occount titles are outomatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before creditentries.) Prepare the journal entries, that Crane should record on December 31,2027 . (Credit account titles are automatically indented when 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 answers to 0 decimal places e8. 58,971. List all debit entries before credit entries.) What amounts would appear on Crane's December 31,2027 , balance sheet relative to the lease arrangement? (Round answers to decimal places, eg. 58,971.)

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