On December 31, 2024, Pharoah Company leased machinery from Sheridan Corporation for an agreed-upon lease term of 3 years. Pharoah agreed to make annual lease payments of $16,000, beginning on December 31, 2024. The expected residual value of the machinery at the end of the lease term is $8,000. (a) Your answer is correct. What amount will Pharoah 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 O decimal places, e.g. 5,275.) Click here to view factor tables. (b) Lease liability $ eTextbook and Media * Your answer is incorrect. 46177 Attempts: 1 of 3 used Pharoah guarantees a residual value of $8,000 at the end of the lease term. What if the expected residual value at the end of the lease term is $4,000 and Pharoah guarantees a residual of $8,000? (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to O decimal places, e.g. 5,275.) Click here to view factor tables. Lease liability $ eTextbook and Media eTextbook Save for Later 47933 Assistance Used Attempts: 2 of 3 used Submit Answer