1. At January 1, 2022, Bud Company leased a machine from Omega manufacturer. The following infomration pertains to the lease:

Lease term: 3 years

Annual lease payments beginning Jan 1, 2022 and at each December 31 thereafter through 2023: $50,000

Omega manufacturrer implicit rate (known by Bud): 8%

On December 31, 2024, the machine reverts back to Omega. Both companies use straight-line depreciation/amortization. Assume useful life of machine is 3 years. The lease is classified as a finance lease/sales-type lease:

QUESTIONS:

1. What is the amount related to the lease that BUD will report in its income statement for the year ended December 31, 2022 (ignore income taxes):

2. What is the balance of lease liability that BUD will report in its balance sheet at December 31, 2022?

3. What is the balance of right-of-use asset that BUD will report in its balance sheet at December 31, 2022?

4. What is the amount related to the bonds that BUD will report in its statement of cash flows for the year ended December 31, 2022? Indicate the category in which to classify:

Cash flows __________ activities at __________ (amount), _____________ activities ____________(amount)

5. Assume the cost of the machine on Omega's book is $119,163, what is the amount related to the least that BUD will report in its income statement for the year ended December 31, 2022?