he following are the facts for the first question asked of prospective employees. In 2019, Sheridan Enterprises negotiated and closed a lease contract for newly constructed truck terminals and freight storage facilities. On January 1, 2020, Sheridan took possession of the leased property. The 20-year lease is effective for the period January 1, 2020, through December 31, 2039. Advance rental payments of $680,000 are payable to the lessor (owner of facilities) on January 1 of each of the first 10 years of the lease term. Advance payments of $344,000 are due on January 1 for each of the last 10 years of the lease term. Sheridan has an option to purchase all the leased facilities for $1 on December 31, 2039. At the time the lease was negotiated, the fair value of the truck terminals and freight storage facilities was approximately $6.12 million. If the company had borrowed the money to purchase the facilities, it would have had to pay 10% interest. Click here to view the factor table PRESENT VALUE OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY OF 1. Click here to view the factor table PRESENT VALUE OF AN ANNUITY DUE. Calculate the present value of the payments required of Sheridan Enterprises under the lease agreement using Excel functions for an annuity due. (Round answers to 2 decimal places, e.g. 5,275.25.) Steps to be followed include: 1. Calculate the present value of the future cash flows for the advance rental payments of $680,000 for the period from January 1, 2020, through December 31, 2029. Hint: If using factor tables, because the lease payments are due at the beginning of each year, use the PV.2 regular annuity table for nine years and add the first payment of January 1, 2020, in your calculation. $ 2. Calculate the present value of the future cash flows for the advance rental payments of $344,000 for the 10-year period beginning January 1, 2030. Hint: If using factor tables, as in the first step, use the PV.2 regular annuity table for 10 years for the present value at January 1, 2029.