1. On January 1, 2016, Bella Donna leased an office building. Terms of the lease require Bella Donna to make 20 annual lease payments of $16,175 beginning on January 1, 2017. A 12% interest rate is implicit in the lease agreement. At what amount should Bella Donna record the lease liability on January 1, 2016, before any lease payments are made?

2. Mamma Mia Company needs to accumulate sufficient funds to pay a $449,300 debt that comes due on December 31, 2021. The company will accumulate the funds by making five equal annual deposits to an account paying 10% interest compounded annually. Determine the required annual deposit if the first deposit is made on December 31, 2017.