Oriole Corporation enters into a $7-$year lease of equipment on December $31,2024,$ which requires $7$ annual payments of $$38,200$ each, beginning December $31,2024.$ In addition, Oriole guarantees the lessor a residual value of $$18,500$ at the end of the lease. However, Oriole believes it is probable that the expected residual value at the end of the lease term will be $$9,250.$ The equipment has a useful life of $7$ years.

Prepare Orioles' December $31,2024,$ journal entries, assuming the implicit rate of the lease is $11\%$ and this is known to Oriole. $($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 O for the amounts. For calculation purposes, use $5$ decimal places as displayed in the factor table provided and round final answers to $0$ decimal places e$.$g$.5,275.)$

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Account Titles and Explanation

Debit

$($To record the lease liability$)$

SUPPO

$($To record lease payment$)$