A city government has a nine-year capital lease for property being used within the General Fund.

The lease was signed on January 1, 2010. Minimum lease payments total \($90,000\) starting at the end of the first year but have a current present value of \($69,000\). Annual payments are \($10,000\), and the interest rate being applied is 10 percent. What liability is reported on the fund-based financial statements as of December 31, 2010, after the first payment has been made?

a. $–0–.

b. $59,000.

c. $65,900.

d. $80,000.