On January 1, 2021, Packard Corporation leased equipment to Hewlitt Company. The lease term is 12 years. The first payment of $453,000 was made on January 1, 2021. Remaining payments are made on December 31 each year, beginning with December 31, 2021. The equipment cost Packard Corporation $3,361,310. The present value of the lease payments is $3,395,263. The lease is appropriately classified as a sales-type lease. Assuming the interest rate for this lease is 10%, what will be the balance reported as a liability by Hewlitt in the December 31, 2022, balance sheet? (Round your final answer to nearest dollar.)

Multiple Choice

• $2,608,838.

• $2,783,489.

• $2,348,838.

• $2,942,263.