Eastern Edison Company Leased Equipment from Low-Tech Leasing on January

Eastern Edison Company leased equipment from Low-Tech Leasing on January 1, 2018. Low-Tech recently purchased the equipment at a cost of $222,664.
Other information:
$$\begin{array} { l l } \text { Lease term } & 3 \text { years } \\\text { Annual payments } & \$ 80,000 \text { on January } 1 \text { each year } \\\text { Life of asset } & 3 \text { years } \\\text { Fair value of asset } & \$ 222,664 \\\text { Implicit interest rate } & 8 \% \\\text { Incremental rate } & 8 \%\end{array}$$
There is no expected residual value.
Required: Prepare appropriate journal entries for Low-Tech Leasing for 2018. Assume a December 31 year-end. Round your answers to the nearest whole dollar amounts.

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