Please show work.

a Monty Corporation leased equipment to Teal Mountain, Inc. on January 1, 2020. The lease agreement called for annual rental payments of $1,350 at the beginning of each year of the 3-year lease. The equipment has an economic useful life of 7 years, a fair value of $8,600, a book value of $6,600, and Monty expects a residual value of $6,100 at the end of the lease term. Monty set the lease payments with the intent of earning a 8% return, though Teal Mountain is unaware of the rate implicit in the lease and has an incremental borrowing rate of 10%. There is no bargain purchase option, ownership of the lease does not transfer at the end of the lease term, and the asset is not of a specialized nature. Click here to view factor tables. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) Suppose, instead of a 3-year lease term, Teal Mountain and Monty agree to a one-year lease with a payment of $1,350 at the start of the lease. Prepare necessary journal entry for Teal Mountain in 2020. (Credit account titles are autematically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit 1/1/20