Exercise 21A-17 a-c (Part Level Submission) On January 1, 2017, Sage Hill Co. leased a building to Oriole 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 $2,800,000 (unguaranteed). 2. The leased building has a cost of $3,300,000 and was purchased for cash on January 1, 2017. 3. The building is depreciated on a straight-line basis. Its estimated economic life is 50 years with no salvage value. * Lease payments are $270,000 per year and are made at the beginning of the year. 5. Oriole has an incremental borrowing rate of 6%, and the rate implicit in the lease is unknown to Oriole. 6. Both the lessor and the lessee are on a calendar-year basis. Prepare the journal entries that Sage Hill should make in 2017. (C indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit 1/1/17 (To record cost of the building) (To record receipt of lease payment) 12/31/17 (To record the recognition of the revenue each period) (To record depreciation expense on the leased asset)