Teal Mountain Corporation recorded a right-of-use asset for

Teal Mountain Corporation recorded a right-of-use asset for $312,900 as a result of a finance lease on December 31, 2016. Teal Mountain’s incremental borrowing rate is 10%, and the implicit rate of the lessor was not known at the commencement of the lease. Teal Mountain made the first lease payment of $58,249 on December 31, 2016. The lease requires 7 annual payments. The equipment has a useful life of 7 years with no residual value.

Prepare Teal Mountain’s December 31, 2017, entries. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answer to 0 decimal places e.g. 5,275.)