Kimberly Leasing Company signs an agreement on January $1,2025,$ to lease equipment to Splish Company. The following information relates to this agreement.

$1.$ The term of the non$-$cancelable lease is $3$ years with no renewal option. The equipment has an estimated economic life of $5$ years.

$2.$ The fair value of the asset at January $1,2025,$ is $$93,000.$

$3.$ The asset will revert to the lessor at the end of the lease term, at which time the asset is expected to have a residual value of $$12,000,$ none of which is guaranteed.

$4.$ The agreement requires equal annual rental payments of $$28,527\mathrm{.}18$ to the lessor, beginning on January $1,2025.$

$5.$ The lessee's incremental borrowing rate is $5\%.$ The lessor's implicit rate is $4\%$ and is unknown to the lessee.

$6.$ Splish uses the straight$-$line depreciation method for all equipment.

Click here to view factor tables.

Prepare all of the journal entries for the lessee for $2025$ to record the lease agreement, the lease payments, and all expenses related to this lease. Assume the lessee's annual accounting period ends on December $31.$Kimberly Leasing Company signs an agreement on January $1,2025,$ to lease equipment to Splish Company. The following information

relates to this agreement.

The term of the non$-$cancelable lease is $3$ years with no renewal option. The equipment has an estimated economic life of $5$

years.

The fair value of the asset at January $1,2025,$ is $$93,000.$

The asset will revert to the lessor at the end of the lease term, at which time the asset is expected to have a residual value of

$$12,000,$ none of which is guaranteed.

The agreement requires equal annual rental payments of $$28,527\mathrm{.}18$ to the lessor, beginning on January $1,2025.$

The lessee's incremental borrowing rate is $5\%.$ The lessor's implicit rate is $4\%$ and is unknown to the lessee.

Splish uses the straight$-$line depreciation method for all equipment.

Click here to view factor tables.

Prepare all of the journal entries for the lessee for $2025$ to record the lease agreement, the lease payments, and all expenses related to

this lease. Assume the lessee's annual accounting period ends on December $31.($For calculation purposes, use $5$ decimal places as

displayed in the factor table provided and round answers to $2$ decimal places, e$.$g$.5,265\mathrm{.}25.$ List all debit entries before credit entries. Credit

account titles are automaticallv indented when the amount is entered. Do not indent manuallv. Record iournal entries in the order presented in