Each of the three independent situations below describes a finance lease in which annual lease payments are payable at the beginning of each year. The lessee is aware of the lessor's implicit rate of return. (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.)

	Situation
	1	2	3
Lease term (years)	11	21	5
Lessor's rate of return (known by lessee)	10%	8%	11%
Lessee's incremental borrowing rate	11%	9%	10%
Fair value of lease asset	$770,000	$1,150,000	$355,000

Required: a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease liability, for each of the above situations. (Round your answers to the nearest whole dollar.)

Answer is complete but not entirely correct.

	Lease Payments	Right-of-use Asset/Lease Payable
Situation 1	$111,886selected answer incorrect	$658,113selected answer incorrect
Situation 2	$113,659selected answer incorrect	$1,036,334selected answer incorrect
Situation 3	$85,152selected answer incorrect	$269,847selected answer incorrect