Keller Corporation (the lessee) entered into a general equipment lease with Dallo Company (the lessor) on January 1 of Year 1. The following information pertains to this lease agreement:

1.	The equipment reverts back to the lessor at the end of the lease, and there is no bargain purchase option.
2.	The lease term is 8 years and requires annual payments of $10,000 at the beginning of each year.
3.	The fair value of the equipment at lease inception is $100,000. Assume that the present value of lease payments discounted at a 10% interest rate is $58,684.19.
4.	The equipment has an estimated economic life of 20 years and has zero residual value at the end of this time.

Required:

Prepare the journal entry that Keller Corporation would make during the first year of the lease assuming that the lease is classified as an operating lease.