Problem 21A-6 b-f Whispering Leasing Company agrees to lease equipment to Metlock 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. Metlock estimates that the expected residual value at the end of the lease term will be 91,000. Metlock 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 Whispering desires a 10 rate of return on its investments. Met ock's incremental borrowing rate is 11% and the essors implicit rate unknown (Assume the accounting period ends on December 31.) Click here to view factor tables Calculate the amount of the annual rental payment required. (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.) Annual rental payment SHOW LIST OF ACCOUNTS 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 LIST OF ACCOUNTS SHOW Debit Date Account Titles and Explanation Credit 1/1/17 Right-of-Use Asset Lease Liability (To record the lease.) Depreciation Expense lity Cash (To record lease payment.) 12/31/17 Depreciation Expense Accumulated Depreciation-Capital Leases (To record amortization.) Interest Expense Interest Payable (To record interest.) (To record amortization.) Credit Date Account Titles and Explanation Debit (To record the lease.) (To record lease payment.) Suppose Metlock 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 SHOW LIST OF ACCOUNTS