Computing Lease Liability Lessee Company enters into a 6-year finance lease of non-specialized equipment with Lessor Company on January 1 . Lessee has agreed to pay $22,400 annually beginning immediately on January 1 . The lessor estimates the residual value of the equipment to be $4,000 at lease end, and the lessee guarantees the residual value. The economic life of the asset is 7 years. The lessee's incremental borrowing rate is 7% and the lessor's implicit rate is not readily determinable by the lessee company. Compute the value of the lease liability for the lessee on January 1 , under the following separate scenarios. a. The lessee estimates that the underlying asset will have a fair value of $4,000 at the end of the lease. b. The lessee estimates that the underlying asset will have a fair value of $1,600 at the end of the lease. Note: Round your answers to the nearest whole dollar. a. Lease liability b. Lease liability