11. On January 1, 20x1, ABC, Co. leased machinery with a fair value of $750,000 from XYZ Rentals Co. The agreement is a seven-year non-cancelable lease requiring annual payments of $140.000. The lease is appropriately accounted for by ABC as a finance lease. ABC's incremental borrowing rate is 11%. ABC knows the interest rate implicit in the lease payments is 10%. The first payment is due 1/1/x1. The present value of an annuity due of 1 for 7 years at 10% is 5.35526. The present value of an annuity due of 1 for 7 years at 11% is 5.23054 In its December 31, 20x1 balance sheet, ABC should report a lease liability of