Pharoah Corporation manufactures drones. On December $31,2024,$ it leased to Althaus Company a drone that had cost $$258,000$ to

manufacture The lease agreement covers the $5-$year useful life of the drone and requires five equal annual rentals of $$86,800$ payable

each December $31,$ beginning December $31,2024.$ An interest rate of $8\%$ is implicit in the lease agreement. Collectibility of the rentals

is not probable.

Prepare any journal entry for Pharoah on December $31,2024.($List debit entry before credit entry. If no entry is required, select $"$No Entry"

for the account titles and enter $0$ for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent

manually.$)$

Credit