Oriole Company leases an automobile with a fair value of $10,452 from John Simon Motors, Inc., on the following terms:

1.

Noncancelable term of 50 months.2.

Rental of $240 per month (at end of each month). (The present value at 1% per month is $9,408.)3.

Estimated residual value after 50 months is $1,030. (The present value at 1% per month is $626.) Oriole Company guarantees the residual value of $1,030.4.

Estimated economic life of the automobile is 60 months.5.

Oriole Company's incremental borrowing rate is 12% a year (1% a month). Simon's implicit rate is unknown.

What is the present value of the minimum lease payments?

The present value of the minimum lease payments

$enter the present value of the minimum lease payments

Record the lease on Oriole Company's books at the date of inception.

Record the first month's depreciation on Oriole Company's books (assume straight-line).

Record the first month's lease payment.