Recording Sales$-$Type Lease Journal Entries$-$No Residual Value

Franklin Co$.$ leased its manufactured equipment to Parker Inc. for a four$-$year term. Franklin Co$.$ reported a book value of $$55,000$ for the equipment in its inventory account. The lease commenced on January $1$ with the first annual payment of $$18,500$ due immediately. The equipment has a useful life of four years, an estimated fair value of $$68,880,$ and no residual or salvage value. The implicit rate of the lease is $5\%$ and collectibility of the lease payments from Parker is probable.

Record Franklin's journal entries at the commencement of the sales$-$type lease for the $(1)$ lease receivable and $(2)$ receipt of the first payment.

Note: Round your answers to the nearest whole dollar.

$\backslash$table$[[$Date$,$Account Name,Dr$.,Cr.],[1)$ Jan. $1,$Lease Receivable,$68,880,0],[$Cost of Goods Sold,$55,000,0],[$Sales Revenue,$0,68,880],[$Inventory$,0,55,000],[$To derecognize asset and record investment in lease,,$],[2)$ Jan. $1,$Cash,$50,380,0],[$Lease Receivable,$0,36,500],[$To record cash lease payment,,$]]$