Listen > On January 1, 2021, Wetick Co. leased equipment from South Co., which had purchased the equipment at a cost of $718,619. The lease specifies six annual payments of $150,000 beginning January 1, 2021 and at each December 31 thereafter through 2025. The six-year lease term is equal to the estimated useful life of the equipment. The lease specifies that the lease payments for each year will increase on the basis of the increase in the Consumer Price Index (CPI) for the year just ended. The CPI at the beginning of the lease is 120 and the CPI on December 31, 2021 is 124. Thus, the first payment is $150,000 and the second payment is $155,000. The interest rate for the lease is 10% and the present value of six lease payments of $150,00p is $718,619. Identify the following statements that are TRUE regarding Wetick's accounting for the lease. One journal entry on December 31, 2021 would include a debit to Interest Expense for $71,862. One journal entry on January 1, 2021 would include a debit to Right-of-Use Asset for $718,619 and a credit to Lease Payable for $718,619. One journal entry on December 31, 2021 would include a debit to Lease Expense for $155,000. One journal entry on January 1, 2021 would include a debit to Lease Payable for $150,000 and a credit to Cash for $150,000. MacBook Air 80 F3 F4 17