Exercise 21-08 Pharoah Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2020. The lease is for an 8-year period and requires equal annual payments of $31,296 at the beginning of each year. The first payment is received on January 1, 2020. Pharoah had purchased the machine during 2016 for $116,000. Collectibility of lease payments by Pharoah is probable. Pharoah set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Pharoah at the termination of the lease. Click here to view factor tables. Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to o decimal places e.g. 5,275.) Amount of the lease receivables Prepare all necessary journal entries for Pharoah for 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to o decimal places e.g. 5,275.) Debit Credit Date Account Titles and Explanation 1/1/20 (To record the lease) (To record the first lease payment) 12/31/20 Suppose the collectibility of the lease payments was not probable for Pharoah. Prepare the necessary journal entry for the company in 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Debit Credit Date Account Titles and Explanation 1/1/20 SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT Suppose at the end of the lease term, Pharoah receives the asset and determines that it actually has a fair value of $1,170 instead of the anticipated residual value of $0. Record the entry to recognize the receipt of the asset for Pharoah at the end of the lease term. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to o decimal places e.g. 5,275.) Explanation Debit Credit Date Account Titles and Explanation 1/1/20