A lease agreement that qualifies as a capital lease calls for annual lease payments of $30,000 over a four-year lease term, with the first payment at January 1, the leases inception. The interest rate is 8% (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

Complete the amortization schedule for the first two payments.

Date	Lease Payable	Interest Expense	Decrease in Balance	Outstanding Balance
01/01/2016
01/01/2016
01/01/2017

If lessees fiscal year is the calendar year, what would be the amount of the lease liability that the lessee would report in its balance sheet at the end of the first year?

Lease liability

What would be the interest payable?

Interest payable