Lease agreement between a manufacturer and a business who is leasing a piece of equipment with the useful life of eleven years beginning on May/30/2005. Equal payments of 25,250 from the lessee is required at the beginning of each year of this ten-year lease agreement. Included is a guaranteed residual value of 20,000. The equipment's fair value and cost at inception of the lease are one of the same of 185,078. The incremental interest as well as the implicit rate are 9% and the equipment is returned to the manufacturer at the end of this non-cancelable lease. They both use a straight-line-amortization method. 

Please answer the following questions in steps on how you got the answer and showing the calculations for each step. Please round all final answers to the nearest dollar. 

1) What would the journal entries be for the lessor and lessee following ASPE? 

2) Considering this is the only information given would there be a year end at December 31 assumed included in the accounting journals?