Sunland Company leases a building to Sheridan, Inc. on January 1,2025. The following facts pertain to the lease agreement: 1. The lease term is 4 years, with equal annual rental payments of $4,848 at the beginning of each year. 2. Ownership does not transfer at the end of the lease term, there is no bargain purchase option, and the asset is not of a specialized nature. 3. The building has a fair value of $19,900, a book value to Sunland of $13,930, and a useful life of 5 years. 4. At the end of the lease term. Sunland and Sheridan expect there to be an unguaranteed residual value of $3,480. 5. Sunland wants to earn a return of 8% on the lease, and collectibility of the payments is probable. This rate is known by Sheridan. Debit Credit Date Account Titles and Explanation 1/1/25 Lease Receivable Cost of Goods Sold Sales Revenve Inventory (To record the lease) Date Account Titles and Explanation (To record the lease) (To record lease payment) (To record lnterest expense) (To record amontization of the right-of use asset)