On Jаnuаry 1, 20X2, Pаrent purchased equipment fоr $204,110 and immediately leased the equipment tо its 90% оwned Subsidiary on a 4-year lease. The minimum lease payments of $60,000 are to be made annually on January 1, beginning immediately, for a total of 4 payments. The implicit interest rate is 12%. The lease provides for an automatic transfer of title at the end of 4 years. The estimated useful life of the equipment is 6 years. The lease has been capitalized by both companies. The lease amortization schedule is presented below: As of December 31, 20X2, the elimination and adjustment journal entries related to this intercompany lease would require: