(c) What is the signiticance of the dife ER calculated in part(a) and the selling price of the machi 4 Ea0-6 (Amorizaton Schedule and lournal Entries for Lessee) Oakridge Leasing C 8) ment on January 1, 2017 to lease equipment to LeBlanc Limited. Oakridg sing oration signs an agres e and LeBlanc foliew ASPE. The 3 information relates to the agreement. 1. The term of the non-cancellable lease is five years, with no renewal option. The equipment has an nomic life of six years. 2. The asset's fair value at January 1, 2017 is $80,000. 3. The asset will revert to the lessor at the end of the lease term, at which time the asset is expected to have a residual value of S7,000, which is not guaranteed. 4. LeBlanc Limited assumes direct responsibility for all executory costs, which include the following annual $900 to Rocky Mountain Insurance Ltd. for insurance and $1,600 to James Township for property taxes. 5. The agreement requires equal annual rental payments of S18,143 to Oakridge, the lessor, beginning on 2017 ary L, 6. The lessees incremental borrowing rate is 1 1 %. The lessors implicit rate is 10% and is known to the lessee. 7. LeBlanc Limited uses the straight-line depreciation method for all equipment and rounds amounts to the nearest dollar. 8. LeBlanc uses reversing entries when appropriate