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Rodgers Corporation agrees on January 1, 2019, to lease equipment from Packers, Inc. for 3 years. The lease calls for annual lease payments of $12,000

Rodgers Corporation agrees on January 1, 2019, to lease equipment from Packers, Inc. for 3 years. The lease calls for annual lease payments of $12,000 at the beginning of each year. The lease does not transfer ownership or contain a bargain purchase option and is not a specialized asset. In addition, the economic life of the equipment is 10 years. Assume the implicit rate used by the lessor is 8%, and this is known to Rodgers. Required: Prepare Rodgers' journal entries on January 1, 2019, and on December 31, 2019.

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