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Metiock Leasing Company signs a lease agreement on January 1,2025, to lease warehouse equipment to Ivanhoe Company. The term of the non-cancelable lease is 2

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Metiock Leasing Company signs a lease agreement on January 1,2025, to lease warehouse equipment to Ivanhoe Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement: 1. Ivanhoe has the option to purchase the equipment for $19,800 upon termination of the lease. It is not reasonably certain that Ivanhoe will exercise this option. 2. The equipment has a cost of $164,000 and fair value of $188,600 to Metlock Leasing. The useful economic life is 2 years, with a residual value of $19,800. 3. Metiock Leasing desires to earn a return of 6% on its investment. 4. Collectibility of the payments by Metlock Leasing is probable. Click here to view factor tables. (a) Prepare the journal entries on the books of Metlock Leasing to recognize the establishment of the lease and receipt of the payments for the years 2025 and 2026. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter Ofor the amounts. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to 0 decimal places eg. 5,275.) Prepare the journal entries on the books of Metlock Leasing to recognize the establishment of the lease and receipt of the payments for the years 2025 and 2026. (List all debit entries before credit entries. Credit account titles are outomatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter Ofor the amounts. For colculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to 0 decimal places eg. 5,275

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