Koffman and Sons signed a four-year lease for a forklift on January 1, 2017. Annual lease payments of $1,510, based on an interest rate of 8%, are to be made every December 31, beginning with December 31, 2017.

PV of Annuity of $1

Required:

Refer to the table above for present value factors.

1. Assume that the lease is treated as an operating lease.

a. Will the value of the forklift appear on Koffman's balance sheet? NO

b. What account will indicate that lease payments have been made? Lease expense No

c. Calculate the amount of depreciation expense for the year 2017. Round answer to the nearest whole dollar. $1250

d. At what amount would the lease obligation be presented on the balance sheet as of December 31, 2017? Round answers to the nearest whole dollar.

Current liability portion	$
Long-term liability portion	$