Question 12 of 13 0.54 / 1 III View Policies Show Attempt History Current Attempt in Progress Your answer is partially correct. Laura Leasing Company signs an agreement on January 1, 2020, to lease equipment to Windsor Company. The following information relates to this agreement. 1. The term of the non-cancelable lease is 3 years with no renewal option. The equipment has an estimated economic life of 5 years. 2. The fair value of the asset at January 1, 2020, is $79,000. 3. The asset will revert to the lessor at the end of the lease term, at which time the asset is expected to have a residual value of $9,000, none of which is guaranteed. 4. The agreement requires equal annual rental payments of $24,288.56 to the lessor, beginning on January 1, 2020. 5. The lessee's incremental borrowing rate is 4%. The lessor's implicit rate is 3% and is unknown to the lessee. 6. Windsor uses the straight-line depreciation method for all equipment. Question 12 of 13 0.54/1 2- Prepare all of the journal entries for the lessee for 2020 to record the lease agreement, the lease payments, and all expenses related to this lease. Assume the lessee's annual accounting period ends on December 31. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round answers to 2 decimal places, eg. 5,265.25. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit 1/1/20 79000 Lease Liability 79000 (To record the lease) 1/1/20 Lease Liability 14153 Cash 14153 (To record lease liability) 12/31/20 Interest Expense 1394 Lease Liability 22895 Question 12 of 13 0.54 / 1 III = (To record the lease) 1/1/20 Lease Liability 14153 Cash 14153 (To record lease liability) 12/31/20 Interest Expense 1394 Lease Liability 22895 Cash 24288.56 e Textbook and Media List of Accounts Save for Later Last saved 17 hours ago Attempts: 3 of 10 used Submit Answer Saved work will be auto-submitted on the due date. Auto- submission can take up to 10 minutes