Exercise 21-03 (Part Level Submission) Kingbird Company leases an automobile with a fair value of $20,275 from John Simon Motors, Inc., on the following terms:

1. Non-cancelable term of 50 months.

2. Rental of $430 per month (at the beginning of each month).

3. Kingbird guarantees a residual value of $1,030. Delaney expects the probable residual value to be $1,030 at the end of the lease term.

4. Estimated economic life of the automobile is 60 months.

5. Kingbirds incremental borrowing rate is 6% a year (0.5% a month). Simons implicit rate is unknown. Click here to view factor tables. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.)

(b) X] Your answer is incorrect. Try again. What is the present value of the lease payments to determine the lease liability? (Round answer to O decimal places, e.g. 5,275.) Present value of the lease payments 22530 Click if you would like to Show Work for this question: Modify Show Work Attempts: 1 of 15 used