On January 1, 2017, Beard Company purchased a machine for $800,000. The machine is expected to have a 10-year life and no residual value. On January 1, 2017, it leased the machine to Ajax Company for a three-year period at an annual rental of $200,000 to be paid at the end of each year. The lease has an implicit interest rate of 8%. Ajax has adopted early the provisions of ASC 842 on January 1, 2017.

What's the initial value of the lease liability for Ajax, rounded to the nearest dollar?

Group of answer choices390,994

635,066

515,419

0

600,000

What's the value of the lease liability at the end of 2017, rounded to the nearest dollar?

Group of answer choices342,936

356,653

400,000

274,004

0