Sarasota Company, a risky start-up, is evaluating a lease arrangement being offered by TSP Company for use of a standard computer system. The lease is non-cancelable, and in no case does Sarasota receive title to the computers during or at the end of the lease term. The lease starts on January 1, 2020, with the first rental payment due on January 1, 2020. Additional information related to the lease and the underlying leased asset is as follows. $2.935.00 3 years 5 years $2.880 at end of 3 years which approximates fair value 1 year at $1.440: no penalty for nonrenewal standard renewal clause $9,600 Yearly rental Lease term Estimated economic life Purchase option Renewal option Fair value at commencement Cost of asset to lessor Residual value: Guaranteed Unguaranteed Lessor's implicit rate (known by the lessee) Estimated fair value at end of lease $9.600 -0- $2,880 12% $2,880 (a) Your answer is partially correct. Analyze the lease capitalization tests for this lease for Sarasota. Prepare the journal entries for Sarasota for 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round present value factor calculations to 5 decimal places, eg. 1.25124 and the final answers to 2 decimal places, eg: 52.75. If no entry is required, select "No entry for the account titles and enter for the amounts. Record journal entries in the order presented in the problem.) Click here to view factor tables Date Account Titles and Explanation Debit Credit 1/1/20 Lease Expense 2395,00 Cash 23 (To record the lease) 1/1/20 III DI ONLINE (To record the first lease payment) 12/31/20 To record year end entry) e Textbook and Media