Prepare all necessary journal entries for Pharoh for 2025.

Oriole Company, a machinery dealer, leased a machine to Pharoah Corporation on January 1,2025. The lease is for an 8 -year period and requires equal annual payments of $22,300 at the beginning of each year. The first payment is received on January 1,2025 . Oriole had purchased the machine during 2024 for $160,000. Collectibility of lease payments by Oriole is probable. Oriole set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to oriole at the termination of the lease. Assume that Pharoah Corporation does not know the rate implicit in the lease used by Oriole, and Pharoah's incremental borrowing rate is 8% in addition, assume that Pharoah incurs initial direct costs of $16.000 Click here to view factor tables. (a) Your answer is correct: Compute the amount of the lease liability and right-of-use asset for Pharoah (For colculotion pumpsex use 5 decimal places as displayed in the foctor table provided and round final answers to 0 decimal ploces es 5,275.) Lease liability Right-of-use asset 5