Please be as detailed as possible and show your work

Initial data from question a)

Now question f) Suppose that instead of $1,200 X expects the residual value to be only $500 ( the guaranteed amount is still $1,200). How does the calculation of the present value of the lease change from what has been calculated on part b)

Part b) was: record the lease on X s books at the date of commencement ( fairvalue was $27,704)? ( round your answer to 0 decimal places)

1. Non-cancelable terms of 50 months.

2. Rental of $600 per month ( at the beginning of each month). ( The present value at 0.5% per month is $26,618).

3. X guarantees a residual value of $1,200 ( the present value at 0.5% per month is $546). X expects the probable residual value to be $1,200 at the end of the lease term.

4. Estimated economic life of the automobile is 60 months

5. Xs incremental borrowing rate is 6% a year (0.5% a month). Yall implicit rate is unknown.