The Right of use asset and lease liability were recognised for fixtures and equipment leased from Christchurch Hire Ltd on 1 April 2021. Based on the lease agreement, there was an initial deposit of $17,250 on 1 April 2021, followed by seven installments of $60,000 at the end of each year. The interest rate implicit in the lease is 11 percent, and the present value of the seven lease installment payments is $300,000. The estimated residue value of the fixtures and equipment is $150,000, but Prince Ltd does not guarantee the residual value. The fixtures and equipment will be returned to Christchurch Hire Ltd at the end of the lease term. Prince Ltd uses 20% p.a. (straight line) on the cost to account for depreciation for fixtures and equipment. No entries have been made at the end of the year regarding the leased asset or the lease liability.

Write down journal entries.