Laura Leasing Company signs an agreement on January 1, 2020, to lease equipment to Shamrock 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, 2020, is $85,000.
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 $5,000, none of which is guaranteed.
4.		The agreement requires equal annual rental payments of $27,911 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.		Shamrock uses the straight-line depreciation method for all equipment.

Prepare an amortization schedule that would be suitable for the lessee for the lease term. (Round answers to 0 decimal places, e.g. 5,265.)

Prepare all of the journal entries for the lessee for 2020 and 2021 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

The dates for the journal entries are 1/1/20, 12/31/20, 1/1/21, 12/31/21, During 2020 and During 2021

SHAMROCK COMPANY (Lessee) Lease Amortization Schedule Interest on Reduction of Lease Liability Liability Annual Lease Payment Date Lease Liability 1/1/20 s 1/1/20 1/1/21 1/1/22 Date Account Titles and Explanation Debit Credit (To record the lease) (To record lease payment) (To record interest expense) (To record amortization of the right-of-use asset) (To reverse interest expense) (To record lease payment) (To record interest expense) (To record amortization of the right-of-use asset)