Oriole Corporation agrees on January $1,2025,$ to lease equipment from Pharoah, Inc. for $3$ years. The lease calls for annual lease payments of $$11,000$ at the beginning of each year. The lease does not transfer ownership, contain a bargain purchase option,

and is not a specialized asset. In addition, the economic life of the equipment is $10$ years, and the present value of the lease payments is less than $90\%$ of the fair value of the equipment. Assume that for Pharoah, Inc., the lessor, the collectibility of the lease

payments is probable, and the fair value and cost of the equipment is $$62,000.$

Prepare Pharoah' $2025$ journal entries, assuming the company uses straight$-$line depreciation and no salvage value.

$($to record the recognition of the revenue each peroid$)$

$($to record the depreciation expense on the leased equipment$)$