Splish Brothers Leasing Company signs a lease agreement on January 1, 2020, to lease electronic equipment to Sunland Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement: 1. 2. Sunland has the option to purchase the equipment for $18,500 upon termination of the lease. It is not reasonably certain that Sunland will exercise this option. The equipment has a cost of $170,000 and fair value of $219,000 to Splish Brothers Leasing. The useful economic life is 2 years, with a residual value of $18,500. Splish Brothers Leasing desires to earn a return of 5% on its investment. Collectibility of the payments by Splish Brothers Leasing is probable. 3. 4. Click here to view factor tables. (a) Prepare the journal entries on the books of Splish Brothers Leasing to reflect the payments received under the lease and to recognize income for the years 2020 and 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answers to O decimal places e.g. 5,275.) Date Account Titles and Explanation Debit Credit 1/1/20 Lease Receivable 219000 Cost of Goods Sold Sales Revenue Inventory 12/31/20 Cash Lease Receivable Interest Revenue 1/1/20 Cash Lease Receivable