3. (Lessee Computations and Entries; Finance Lease with Guaranteed Residual Value) (LO 2. 4) Delaney Company leases an automobile with a fair value of $10,000 from Simon Motors, Inc, on the following terms 1. Non-cancelable term of 50 months 2. Rental of $200 per month (at the beginning of each month) (The present value at O 5% per month " S8873) 3. Delaney guarantees a residual value of S 1,180 (the present 4. Estimated economic life of the automobile is 60 months 5. De value at 0.5% per month S920) Delaney expects probable residaal value to be $1,180 at the end of the lease term laney's incremental borrowing rate is 6% a year (05% a month). Simon's implicit rate is unknown. Instructions (a) What is the nature of this lease to Delaney? (b) What is the present value of the lease payments to determine the lease liability? (e) Based on the original fact pattern, record the lease on Delaney's books at the date of commencement (d) Record the first month's lease payment (at commencement of the lease (e) Record the second month's lease payment () Record the first month's amortization on Delaney's books (assume straight-line). (a) Suppose that instead of $1,180, Delaney expects the residual value to be only $500 (the guaranteed amouet is stll $1,180) How does the calculation of the present valar of the lease payments ch asune srsaighi to lease a storage building from Shefficeld Storage Coempany The following