Laura Leasing Company signs an agreement on January 1, 2020, to lease equipment to Blossom Company. The following information relates to this agreement. A) Prepare all of the journal entries for the lessee for 2020 to record the lease agreement, the lease payments, and all expenses related to this lease. Assume the lessees annual accounting period ends on December 31.

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, 2020, is $75,000.
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 $8,000, none of which is guaranteed.
4.		The agreement requires equal annual rental payments of $23,522.48 to the lessor, beginning on January 1, 2020.
5.		The lessees incremental borrowing rate is 5%. The lessors implicit rate is 4% and is unknown to the lessee.
6.		Blossom uses the straight-line depreciation method for all equipment.

Date Account Titles and Explanation Debit Credit 1/1/20 Right-of-Use Asset | Lease Liability (To record the lease) 1/1/20 - Lease Liability 23522.48 23522.48 | Cash (To record lease liability) Lease Expense 12/31/20 4 23522.48 Lease Liability 23522.48 23522.48 Right-of-Use Asset 23522.48