$.$ has entered an agreement to lease an old warehouse with a useful life of $5$ years and a fair value of $$31,000$ from Sunland Corporation. The agreement stipulates the following.

Rental payments of $$7,189$ are to be made at the start of each year of the $5-$year lease. No residual value is expected at the end of the lease.

must reimburse each year for any real estate taxes incurred for the year. Last year, the cost of real estate taxes was $$700,$ though these costs vary from year to year.

must make a payment of $$500$ with the rental payment each period to cover the insurance has on the warehouse.

paid legal fees of $$3,000$ in executing the lease.