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On December 31, 2024, Cullumber Company leased machinery from Blossom Corporation for an agreed-upon lease term of 3 years. Cullumber agreed to make annual lease

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On December 31, 2024, Cullumber Company leased machinery from Blossom Corporation for an agreed-upon lease term of 3 years. Cullumber agreed to make annual lease payments of $20,000, beginning on December 31,2024 . The expected residual value of the machinery at the end of the lease term is $10,000. (a) Your answer is incorrect. What amount will Cullumber record as its lease liability on December 31,2024 , if its incremental borrowing rate is 4% and the implicit rate of the lease is unknown? (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to 0 decimal places, e.g. 5,275.)

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