S Bramble Industries and Sunland Inc. enter into an agreement that requires Sunland Inc. to build three diesel-electric engines to Bramble's specifications. Upon completion of the engines, Bramble has agreed to lease them for a period of 10 years and to assume all costs and risks of ownership. The lease is non-cancelable, becomes effective on January 1, 2025, and requires annual rental payments of $413,372 each January 1, starting January 1, 2025. Bramble's incremental borrowing rate is 8%. The implicit interest rate used by Sunland and known to Bramble is 6%. The total cost of building the three engines is $2,803,000. The economic life of the engines is estimated to be 10 years, with residual value set at zero. Bramble depreciates similar equipment on a straight-line basis. At the end of the lease, Bramble assumes title to the engines. Collectibility of the lease payments is probable. Click here to view factor tables. Discuss the nature of this lease transaction from the viewpoints of both lessee and lessor. The lease should be treated as a by Bramble Industries. The lease should be treated as a by Sunland Inc. finance lease operating lease sales-type lease Prepare the journal entry to record the transaction on January 1, 2025, on the books of Bramble (the lessee). (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to O decimal places e.g. 58,971. List debit entry before credit entry.) Account Titles and Explanation Debit Credit Prepare the journal entry to record the transaction on January 1, 2025, on the books of Sunland (the lessor). (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round answers to O decimal places e.g. 58,971. List all debit entries before credit entries.) Prepare the journal entry to record the transaction on January 1, 2025, on the books of Sunland (the lessor). (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Round answers to O decimal places e.g. 58,971. List all debit entries before credit entries.) Account Titles and Explanation Debit Credit Prepare the journal entries for both the lessee and lessor to record the first rental payment on January 1, 2025. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Account Titles and Explanation Lessee (January 1, 2025) Debit Credit Lessor (January 1, 2025) Debit Credit