Smithston Corporation leased equipment to Dayplanner Co. on January 1, 2011. The terms of the lease called for annual lease payments to be made at the first of each year. Smithston’s implicit interest rate for the transaction is 12%. On July 1, 2013, Dayplanner purchased the equipment and paid $58,000 to complete the transaction.

After the 2013 payment was made, the following balance relating to the leased equipment was on the books of Smithston as of January 1, 2013:

Lease Payments Receivable (net) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $75,750

Prepare the journal entry that should be made by Smithston to record the sale, including the accrual of interest through July 1.