On January 1, 2017, Sunland Company contracts to lease equipment for 5 years, agreeing to make a payment of $149,645 at the beginning of each year, starting January 1, 2017. The leased equipment is to be capitalized at $624,000. The asset is to be amortized on a double-declining-balance basis, and the obligation is to be reduced on an effective-interest basis. Sunlands incremental borrowing rate is 6%, and the implicit rate in the lease is 10%, which is known by Sunland. Title to the equipment transfers to Sunland at the end of the lease. The asset has an estimated useful life of 5 years and no residual value. Click here to view factor tables Prepare the journal entries that Sunland should record on January 1, 2017. (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 0 for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answers to 0 decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit January 1, 2017 enter an account title To record the lease enter a debit amount enter a credit amount enter an account title To record the lease enter a debit amount enter a credit amount (To record the lease.) enter an account title To record lease payment enter a debit amount enter a credit amount enter an account title To record lease payment enter a debit amount enter a credit amount (To record lease payment.) SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT Prepare the journal entries to record amortization of the leased asset and interest expense for the year 2017. (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 0 for the amounts. Round answers to 0 decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit December 31, 2017 enter an account title To record amortization of the leased asset enter a debit amount enter a credit amount enter an account title To record amortization of the leased asset enter a debit amount enter a credit amount (To record amortization of the leased asset.) December 31, 2017 enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT Prepare the journal entry to record the lease payment of January 1, 2018, assuming reversing entries are not made. (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 0 for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answers to 0 decimal places, e.g. 5,275.) Date Account Titles and Explanation Debit Credit January 1, 2018 enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT What amounts will appear on the lessees December 31, 2017, balance sheet relative to the lease contract? SUNLAND COMPANY Balance Sheet (Partial) choose the accounting period Assets select an opening section name enter an account title $enter a dollar amount Liabilities select an opening name for section one enter an account title $enter a dollar amount select an opening name for section two enter an account title $enter a dollar amount SHOW LIST OF ACCOUNTS LINK TO TEXT LINK TO TEXT How would the value of the lease liability in part (b) change if Sunland also agreed to pay the fixed annual insurance on the equipment of $2,000 at the same time as the rental payments? (Round answers to 0 decimal places, e.g. 5,275.) The lease liability $enter the lease liability in dollars