Teal Steel Company, as lessee, signed a lease agreement for equipment for 5 years, beginning December 31,2020 . Annual rental payments of $61,020 are to be made at the beginning of each lease year (December 31 ). The interest rate used by the lessor in setting the payment schedule is 7%; Teal's incremental borrowing rate is $%. Teal is unaware of the rate being used by the lessor. At the end of the lease, Teal has the option to buy the equipment for $5,000, considerably below its estimated fair value at that time. The equipment has an estimated useful life of 7 years, with no salvage value. Teal uses the straight-line method of depreciation on similar owned equipment. (a) Prepare the journal entries, that Teal should record on December 31, 2020. (Credit account titles are automaticolly indented when amount is entered. Do not indent monually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round present value factor calculations to 5 decimal ploces, e.g. 1.25124 and the final answers to 0 decimal places, e.g. 58,971.1 Prepare the journal entries, that Teal should record on December 31, 2021. (Credit account titles are automaticolly indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Prepare the journal entries, that Teal should record on December 31, 2022. (Credit occount titles are automaticolly indented when amount is entered. Do not indent monuolly. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to 0 decimal places e.g. 58,971.) What amounts would appear on Teal's December 31, 2022, balance sheet relative to the lease arrangement? (Round answers to 0 decimal ploces, es. 58,971.] List of Accounts
Accounts Payable
Accumulated Depreciation-Buildings
Accumulated Depreciation-Leased Buildings
Accumulated Depreciation-Capital Leases
Accumulated Depreciation-Equipment
Accumulated Depreciation-Leased Equipment
Accumulated Depreciation-Leased Machinery
Accumulated Depreciation-Machinery
Accumulated Depreciation-Right-of-Use Asset
Advertising Expense
Amortization Expense
Airplanes
Buildings
Cash
Cost of Goods Sold
Deferred Gross Profit
Deposit Liability
Depreciation Expense
Equipment
Executory Costs
Executory Costs Payable
Gain on Disposal of Equipment
Gain on Disposal of Plant Assets
Gain on Lease
Gain on Sale of Buildings
Insurance Expense
Interest Expense
Interest Payable
Interest Receivable
Interest Revenue
Inventory
Land
Leased Asset
Leased Buildings
Leased Equipment
Lease Expense
Leased Land
Lease Liability
Lease Receivable
Lease Revenue
Legal Expense
Loss on Capital Lease
Machinery
Maintenance and Repairs Expense
Notes Payable
Prepaid Lease Executory Costs
Prepaid Legal Fees
Property Tax Expense
Property Tax Payable
Rent Expense
Rent Payable
Rent Receivable
Rent Revenue
Revenue from Sale-Leaseback
Right-of-Use Asset
Salaries and Wages Expense
Sales Revenue
Selling Expenses
Trucks
Unearned Profit on Sale-Leaseback
Unearned Lease Revenue
Unearned Service Revenue