On December 31, 2019, Teal Mountain Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called for Teal Mountain to make annual payments of $8,634 at the beginning of each year of the lease, starting December 31, 2019. The machine has an estimated useful life of 6 years and a $4,900 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Teal Mountain uses the straight-line method of depreciation for all of its plant assets. Teal Mountain's incremental borrowing rate is 12%, and the lessor's implicit rate is unknown. Click here to view factor tables. (a) Your answer is correct. What type of lease is this? This is a/an finance lease. e Textbook and Media List of Accounts Attempts: 2 of 3 used (b) * Your answer is incorrect. Compute the present value of the lease payments. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to O decimal places eg. 5,275.) Present value of the lease payments $ 31123.8432 e Textbook and Media List of Accounts Save for Later Attempts: 2 of 3 used Submit Answer (c) Prepare all necessary journal entries for Teal Mountain for this lease through December 31, 2020. (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 decimal places eg. 5,275.) Date Account Titles and Explanation Debit Credit (To record the lease) (To record first lease payment) (To record amortization of the right-of-use asset) (To record interest expense) e Textbook and Media List of Accounts Save for Later Attempts: 0 of 3 used Submit