INTERMEDIATE ACCOUNTING -2 3. On January 1, 2020, E DI SA PUSO MO company sold a heavy machinery to Krusty Krab and immediately leased it back for 4 years. The transaction has the following details: Sales price 10,000,000 Fair market value of heavy machinery 7,500,000 Cost of Heavy machinery 8,000,000 Accumulated depreciation 1,000,000 Annual rental 2,000,000 Implicit interest rate 10% Additional information related to the above transaction a) Annual rental payable at the end of each year b) Present value of an ordinary annuity of 1 at 10% for 4 periods is 3.17 Option 1 What is the Present Value of Lease Liability * 1 point Your answer What amount should be reflected as Cost of Right Use Asset? * 1.point Your answer How much is the gain to be recognized?* 1 point Your answer How much is the gain not to be recognized" 1 point Your