Merrill Corporation, which uses ASPE, enters into a six-year lease of equipment on September 13, 2014, that requires six annual payments of $28,000 each, beginning September 13, 2014. In addition, Merrill guarantees the lessor a residual value of $17,000 at lease end. The equipment has a useful life of six years. Prepare Merrill's September 13, 2014 journal entries, assuming an interest rate of 9%.