Exercise 21-17 (Part Level Submission) On January 1, 2020, Larkspur Co. leased a building to Crane Inc. The relevant information related to the lease is as follows. 1. The lease arrangement is for 10 years. The building is expected to have a residual value at the end of the lease of $3,400,000 (unguaranteed). 2. The leased building has a cost of $3,900,000 and was purchased for cash on January 1, 2020. 3. The building is depreciated on a straight-line basis. Its estimated economic life is 50 years with no salvage value. 4. Lease payments are $250,000 per year and are made at the beginning of the year. 5. Crane has an incremental borrowing rate of 6%, and the rate implicit in the lease is unknown to Crane. 6. Both the lessor and the lessee are on a calendar-year basis.

(b) Your answer is partially correct. Try again. Prepare the journal entries that Crane should make in 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,275. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit 1/1/20 Lease Receivable 250000 asset 250000 (To record the lease) - 250000 7 1/1/20 - Leased Asset 250000 Lease Liability 250000 (To record lease payment) 7 12/31/20 cash 250000 TLease Receivable Click if you would like to Show Work for this question: Open Show Work