IvanhoeInc. leased a new crane to Sarasota Construction under a 5-year, non-cancelable contract starting January 1, 2020. Terms of the lease require payments of $45,500 each January 1, starting January 1, 2020. The crane has an estimated life of 7 years, a fair value of $220,000, and a cost to Ivanhoe of $220,000. The estimated fair value of the crane is expected to be $35,000 (unguaranteed) at the end of the lease term. No bargain purchase or renewal options are included in the contract, and it is not a specialized asset. Both Ivanhoe and Sarasota adjust and close books annually at December 31. Collectibility of the lease payments is probable. Sarasota's incremental borrowing rate is 9%, and Ivanhoe's implicit interest rate of 9% is known to Sarasota. Click here to view factor tables. Identify the type of lease involved and give reasons for your classification. The lease is classified as an operating lease eTextbook and Media Question Part Score --/1 Prepare all the entries related to the lease contract and leased asset for the year 2020 for the lessee and lessor, assuming Sarasota uses straight-line amortization for all similar leased assets, and Ivanhoe depreciates the asset on a straight-line basis with a salvage value of $15,000. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry"for the account titles and enter for the amounts. Round present value factor calculations to 5 decimal places, eg. 1.25125 and the final answer to o decimal places e.g. 58,972.) Date Debit Credit Account Titles and Explanation Lessee's Entries 1/1/20 Leased Asset Lease Liability (To record lease.) 1/1/20 Lease Rental Expense (To record lease payment.) 12/31/20 (To record interest and amortization expense.) Lessor's Entries 1/1/20 (To record the receipt of payment.) 12/31/20 (To record depreciation.) 12/31/20 (To record lease revenue.) e Textbook and Media