CHAPTER 15 (18.)

On January 1, 2018, National Insulation Corporation (NIC) leased equipment from United Leasing under a finance lease. Lease payments are made annually. Title does not transfer to the lessee and there is no purchase option or guarantee of a residual value by NIC. Portions of the United Leasings lease amortization schedule appear below: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1and PVAD of $1) (Use appropriate factor(s) from the tables provided.)

Jan. 1	Payments		Effective Interest		Decrease in Balance		Outstanding Balance
2018							225,001
2018	26,000				26,000		199,001
2019	26,000		23,880		2,120		196,881
2020	26,000		23,626		2,374		194,507
2021	26,000		23,341		2,659		191,848
2022	26,000		23,022		2,978		188,870
2023	26,000		22,664		3,336		185,534
2035	26,000		13,004		12,996		95,374
2036	26,000		11,445		14,555		80,819
2037	26,000		9,698		16,302		64,517
2038	72,259		7,742		64,517		0

Required:

8. What amount would NIC record as a right-of-use asset at the beginning of the lease? (Round your answers to nearest whole dollar.)