Problem 21A-6 b-f Vaughn Leasing Company agrees to lease equipment to Bramble Corporation on January 1, 2017. The following information relates to the lease agreement. 1. The term of the lease is 7 years with no renewal option, and the machinery has an estimated economic life of 9 years. 2. The cost of the machinery is $473,000, and the fair value of the asset on January 1, 2017, is $746,000 3. At the end of the lease term, the asset reverts to the lessor and has a guaranteed residual value of $91,000. Bramble estimates that the expected residual value at the end of the lease term will be 91,000. Bramble amortizes all of its leased equipment on a straight-line basis. 4. The lease agreement requires equal annual rental payments, beginning on January 1, 2017. 5. The collectibility of the lease payments is probable. 6, Vaughn desires a 10% rate of return on its investments. Bramble's incremental borrowing rate is 11%, and the lessor's implicit rate is unknown. Assume the accounting period ends on December 31.) Click here to view factor tables Your answer is correct. calculate the amount o the annual rental payment required. places e.g. 58,972 Round present value factor calculat ons to 5 decima and the fina .2512 answer,to p aces.. decima Annual rental payment 130582 Your answer is correct. Compute the value of the lease liability to the lessee. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to o decimal places e.g. 58,972.) Present value of minimum lease payments 683014 Prepare the journal entries Vaughn would make in 2017 and 2018 related to the lease arrangement. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Round answers to O decimal places e.g. 58,972.) Account Titles and Explanation Date Debit Credit Lease Receivable 746000 Cost of Goods Sold Sales Revenue Inventory To record the lease. Your answer is incorrect. Try again. Suppose Bramble expects the residual value at the end of the lease term to be $81,000 but still guarantees a residual of $91,000. Compute the value of the lease liability at lease commencement Lease liability Click if you would like to Show Work for this question: Open Show Work