Wildhorse Corporation, which uses ASPE, leased equipment it had manufactured at a cost of $128,857 for Sheffield, the lessee. The equipments regular selling price is $164,000. The term of the lease is 8 years, beginning January 1, 2020, with equal rental payments of $27,184 at the beginning of each year. Sheffield pays all executory costs directly to third parties. The equipments fair value at the leases inception is $164,000. The equipment has a useful life of seven years with no residual value. The lease has an implicit interest rate of 9%, no bargain purchase option, and no transfer of title. Collectibility is reasonably assured, with no additional costs to be incurred by Wildhorse. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Prepare Wildhorse Corporations January 1, 2020 journal entries at the inception of the lease and the entry at December 31, 2020, to record interest.