Kemba Company leases a piece of machinery with a fair value of $55,000 to Walker Corp. The lease is for 5 years and calls for payments at the beginning of each year. Kemba sets the lease payments to earn an 8% return and estimates that the machinery will have a residual value of $23,000 at the end of the lease, though this residual amount is unguaranteed. Determine the amount of the annual lease payments.