Demir Leasing Company signs an agreement on January 1, 2015, to lease equipment to Azure Company. The following information relates to this agreement.

1. The term of the non-cancelable lease is 5 years with no renewal option. The equipment has an estimated economic life of 5 years.

2. The fair value of the asset at January 1, 2015 id $90,000.

3. The asset will revert to the lessor at the end of the lease term, at which time the asset is expected to have a residual value of $7000, none of which is guaranteed.

4. Azure Company assumes direct responsibility for all executory costs, which include the following annual amounts: (1)$900 to Frontier Insurance Company for insurance and (2) $1600 for property taxes.

5. The agreement requires equal annual rental payments of $20 541.11 to the lessor, beginning on January 1, 2015.

6. The lessee's incremental borrowing rate is 12%. The lessor's implicit rate is 10% and is known to the lessee.

7. Azure Company uses the straight-line depreciation method for all equipment.

8. Azure uses reversing entries when appropriate.

I have the amortization schedule done but need help with the journal entries for the lessee for 2015 & 2016 to record the lease agreement, the lease payments, and all expenses related to this lease. Assume the lessee's annual accounting period ends on December 31.

1/1/15 to record the lease and lease payment.

During 2015- to record insurance payment and record property tax payment.

12/31/15 to record interest & to record depreciation

1/1/16 to reverse interest & record lease payment

During 2016 to record insurance payment & property tax payment

12/31/16 to record interest & depreciation