Pendergraf Manufacturing Leased Some Manufacturing Equipment for Five Years on July

Pendergraf Manufacturing leased some manufacturing equipment for five years on July 1, 2020. The equipment has an expected life of 10 years. The monthly lease payments are $8,500 ($510,000 in total) . At the end of the lease term, Pendergraf has a right to purchase the equipment for $1,000. The present value of the lease payments at 5% is $451,200.
The entry to record the lease in July will include:

A) A debit to Lease expense of $8,500.
B) A debit to Equipment of $510,000
C) A debit to Right-of-Use Asset (Equipment) of $451,200
D) A debit to Equipment of $511,000