The following facts pertain to a non-cancelable lease agreement between Faldo Leasing Company and Splish Company, a lessee. Commencement date January 1, Annual lease payment due at the beginning of each year, beginning with January 1, $95,499 Residual value of equipment at end of lease term, guaranteed by the lessee $55,000 Expected residual value of equipment at end of lease term $50,000 Lease term 6 years Economic life of leased equipment 6 years Fair value of asset at January 1, $550,000 Lessor's implicit rate Lessee's incremental borrowing rate 5 % The asset will revert to the lessor at the end of the lease term. The lessee uses the straight-line amortization for all leased equipment Click here to view factor tables. 5% Prepare an amortization schedule that would be suitable for the lessee for the lease term. (Round present value factor calculation answers to 0 decimal places e.g. 5,275.) SPLISH COMPANY (Lessee) Lease Amortization Schedule Annual Lease Interest on Reduction of Lease Date Payment Plus GRV Liability Liability Lease Liability 1/1/20 $ $ 1/1/20 1/1/21 1/1/22 1/1/23 1/1/24 1/1/25 12/31/26 Prepare all of the journal entries for the lessee for and to record the lease agreement, the lease payments, and all expenses related to this lease. Assume the lessee's annual accounting period ends on December 31. (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. 5,275. Record journal entries in the order presented in the problem.) Debit Credit Date Account Titles and Explanation Jan 1, 2020 Leased Equipment Lease Liability (To record the lease) During 2020 Lease Liability Cash (To record first lease payment.) Dec. 31, 2020 Interest Expense Interest Payable (To record interest.) Dec 31, 2020 Depreciation Expense Accumulated Depreciation (To record amortization) Jan 1, 2021 Lease Uability Interest Expense (To record second lease payment.) Dec 31, 2021 Interest Expense Interest Payable (To record interest.) Dec 31, 2021 Interest Expense Lease Liability (To record amortization) Suppose Splish received a lease incentive of $5,000 from Faldo Leasing to enter the lease. How would the initial measurement of the lease liability and right-of-use asset be affected? Right-of-use asset $ Lease Liability What if Splish prepaid rent of $5,000 to Faldo? Right-of-use asset Lease Liability Click if you would like to Show Work for this questions Open Show Work