Question 3 of 4 < > 1.67/5: Bridgeport Corporation leased equipment to Metlock, Inc. on January 1, 2025. The lease agreement called for annual rental payments of $851 at the beginning of each year of the 4-year lease. The equipment has an economic useful life of 8 years, a fair value of $7,400, a book value of $5,400, and Bridgeport expects a residual value of $4,900 at the end of the lease term. Bridgeport set the lease payments with the intent of earning a 4% return, though Metlock is unaware of the rate implicit in the lease and has an incremental borrowing rate of 6%. 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.) (a) Your answer is correct. What is the amount of the rental payments used in the lease agreement? (Round answer to 0 decimal places, e.g. 5,275.) (b) Rental payments $ eTextbook and Media eTextbook 1 eTextbook 2 List of Accounts 851 Assistance Used Attempts: 3 of 5 used Prepare the entries for Bridgeport for 2025. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,275. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Date Account Titles and Explanation 1/1/25 Right-of-Use Asset Lease Liability Lease Liability Cash (To record the recognition of the revenue) (To record depreciation expense on the leased equipment) Debit