Ayayal Company leases an automobile with a fair value of $16,738 from John Simon Motors, Inc., on the following terms: 1. Noncancelable term of SO months. 2. Rental of $400 per month (at end of each month). (The present value at 1% per month is $15,679.) 3. Estimated residual value after 50 months is $1,190. (The present value at 1% per month is $724.) Ayayal Company guarantees the residual value of 51,190. 4. Estimated economic life of the automobile is 60 months. 5. Ayayal Company's Incremental borrowing rate is 12% a year 1% a month). Simon's Implicit rate is unknown. Your answer is correct. What is the present value of the minimum lease payments? The present value of the minimum lease payments 116403 Your answer is partially correct. Try again. (c) Record the lease on Ayayal Company's books at the date of inception. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts.) Account Titles and Explanation Debit Credit 164035 3116403 Lease Llability (d) Record the first month's depreciation on Ayayal Company's books (assume straight-line). (Credit account titles are automatically indented when amount is entered. Do not Indent manually. If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Round answers to o decimal places, e.g. 15.) Account Titles and Explanation Debit Credit Depreciation Expense Accumulated Depreciation - Capital Leases (e) Record the first month's lease payment. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to O decimal places, e.g. 15.) Account Titles and Explanation Debit Credit Lease Liability