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Harbor (lessee) signs a four-year capital lease for office equipment with a $26,000 annual lease payment. The present value of the four annual lease payments

Harbor (lessee) signs a four-year capital lease for office equipment with a $26,000 annual lease payment. The present value of the four annual lease payments is $86,000, based on a 8% interest rate. 1. Prepare the journal entry Harbor will record at inception of the lease.

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