Homework: Week Three Question 9, E18.5 (similar to) Part 1 of 8 On January 1, 2019, Star National Bank (SNB) acquired a fleet of trucks to be leased to J Oceans Company. SNB paid $140,130 to acquire the vehicles, which is also the fair value of the fleet. The lease terms follow. (Click the icon to view the terms of the lease.) Read the requirements. HW Score: 14.32%, 3.15 of 22 points Points: 0 of 1 (Click the icon to view the Future Value of $1 table.) (Click the icon to view the Future Value of an Ordinary Annuity table.) (Click the icon to view the Future Value of an Annuity Due table.) Save (Click the icon to view the Present Value of $1 table.) (Click the icon to view the Present Value of an Ordinary Annuity table.) (Click the icon to view the Present Value of an Annuity Due table.) Requirement a. Classify the lease as either a finance lease or an operating lease for J Oceans Company, the lessee. Before completing the requirement, identify the present value of the lease payments. (Use the present value and future value tables, the formula method, a financial calculator, or a spreadsheet for your calculation. If using present and future value tables or the formula method, use factor amounts rounded to five decimal places, X.XXXXX. Round your final answer to the nearest whole dollar.) The present value (PV) of the payments due under the lease is $ More info Requirements a. Classify the lease as either a finance lease or an operating lease for J Oceans Company, the lessee. b. Prepare the journal entries for the first year of the lease for J Oceans Company, the lessee. Print Done Annual rental payments of $49,000 are due on January 1 of each year. Lease term is 3 years. There is no residual value and no purchase option. The economic life of the asset is 3 years. The lessee's incremental borrowing rate is 6%; and the lessor's implicit rate is not known to J Oceans Company. Included in the rental payments are annual sales taxes and maintenance. Annual sales taxes equal $850 paid to the lessor on January 1 of the year and represent a lease component. Annual maintenance is $1,100 and is paid to the lessor at the beginning of the year. The maintenance is a nonlease component, and the lessee elected not to allocate the consideration to the lease and nonlease components due to immateriality. The lessee has elected to account for each separate lease and nonlease component as a single component. SNB has no material uncertainties regarding future costs to be incurred Clear all Check answer