Exercise 21-03 Splish Brothers Company leases an automobile with a fair value of $18,767 from John Simon Motors, Inc., on the following terms: 1. Non-cancelable term of 50 months 2. Rental of $390 per month at the beginning of each month). 3. Splish Brothers quarantees a residual value of $1,410. Delaney expects the probable residual value to be $1.410 at the end of the lease term. 4. Estimated economic life of the automobile is 60 months 5. Solish Brothers's incremental borrowing rate is 6% a year (0.5% a month). Simon's implict rate is unknown Click here to vis faster tables. What is the nature of this lease to Splish Brothers? The nature of this lease is a/an select a nature of the lease lease. What is the present value of the lease payments to determine the lease liability? Present value of the lease payments Senter the Present value of the lease payments in dollars rounded to decimal places Based on the original fact pattern, record the lease on Splish Brothers's books at the date of commencement. Account Titles and Explanation Debit Credit Record the first month's lease payment (at commencement of the lease). Account Titles and Explanation Debit Credit Record the second month's lease payment. Account Titles and Explanation Debit Credit Record the first month's amortization on Splish Brothers's books (assume straight-line). Debit Credit Account Tities and Explanation enter an account title enter an account title Suppose that instead of $1,410, Splish Brothers expects the residual value to be only $500 (the quaranteed amount is still $1,410). How does the calculation of the present value of the lease payments change from part (b)? Senter the present value of lease payments in dollars rounded to decimal PV of lease payments