On January 1, 2020, Rider Inc. leased a truck to Pine Valley Transportation. The lease qualifies as a finance lease under criteria established by the accounting profession. The following information relates to this agreement: 1. The lease term is for ten years. The fair value of the truck on the date of the lease is $70,000, the useful of the truck 15 years. 2. The lease agreement specifies that asset be returned to Rider at the end of the lease term. There is no bargain purchase option in the lease. 3. Lease payments are $8,800 per year with the first payment due January 1, 2020. 4. Pine Valley's incremental borrowing rate is 8%. The lessor's implicit rate is 6% and is known to Pine Valley the lessee. 5. Maintenance costs of $900 (executory costs that are not included in the lease payments) were incurred and paid on June 1, 2020 by Pine Valley. 6. Pine Valley uses straight-line depreciation (amortization) on all its assets. 7. The present value factors for an annuity due are as follows: 8% 6% 7.24689 7.80169 Instructions 1. Provide all necessary journal entries required of Pine Valley for the years 2020 and 2021. 2. Complete the lease amortization schedule below (up to 1/1/23) (round all answers to the nearest dollar) Show all your work Lease Payment Interest Lease Reduction Lease Liability Balance Date 1/1/20 1/1/20 1/1/21 1/1/22 1/1/23 Etc. Date Account Titles and Explanation Dr. Cr