On December 31, 2016, Marin Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called for Marin to make annual payments of $8,199 at the beginning of each year, starting December 31, 2016. The machine has an estimated useful life of 6 years and a $5,200 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Marin uses the straight-line method of depreciation for all of its plant assets. Marins incremental borrowing rate is 11%, and the lessors implicit rate is unknown.

Present Value of Lease Payments are $33,636..

Prepare all necessary journal entries for Marin for this lease through December 31, 2017. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places e.g. 5,275.) DateAccount Titles and Explanation Debit Credit (To record the lease) (To record first lease payment) To record amortization of the right-of-use asset) 12/31/17 (To record interest expense)