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Grouper Incorporated leases a piece of equipment to Skysong Corporation on January 1, 2020. The lease agreement called for annual rental payments of $4,660 at the beginning of each year of the 4-year lease. The equipment has an economic useful life of 6 years, a fair value of $24.600, a book value of $19,600, and both parties expect a residual value of $8,200 at the end of the lease term, though this amount is not guaranteed. Grouper set the lease payments with the intent of earning a 4% return, and Skysong is aware of this rate. There is no bargain purchase option, ownership of the lease does not transfer at the end of the lease term, and the asset is not of a specialized nature. Click here to view factor tables. (For calculation purposes, use 5 decimal places as displayed in the factor table provided) Your answer is incorrect. What is the amount of the rental payments used in the lease agreement? (Round answer to decimal places, s. 5.275) Rental payments $ Prepare the entries for Grouper for 2020. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Round answers to 0 decimal places, eg. 5,275. Record journal entries in the order presented in the problem.) Debit Credit Date 1/1/20 Account Titles and Explanation Cash 4660 Unearned Lease Revenue 12/31/20 Unearned Lease Revenue 4100 12/31/20 Lease Revenue (To record the recognition of the revenue) Depreciation Expense Accumulated Depreciation Equipment (To record depreciation expense on the leased equipment)

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