Reporting a Sales-Type LeaseLessor

On January 1, 2020, the first day of its accounting year, Lessor Inc., leased certain equipment at an annual payment of $11,280, receivable at the beginning of each year for 10 years. The first payment was received immediately. The equipment has an estimated useful life of 12 years and no residual value. Lessors implicit rate is 6%. Lessor had no other costs associated with this lease and properly classified the lease as a sales-type lease. The leased equipment was carried on Lessor Inc.'s books at $71,500.

Required

a. Calculate the value of the lease receivable at the commencement of the lease.

• Note: Round answer to the nearest dollar.
• Note: Do not use a negative sign with your answer.

Lease receivable

??????????

b. What amounts would be presented in the balance sheet as of December 31, 2020, related to this lease?

Note: Round answers to the nearest dollar.

Balance Sheet	Dec. 31, 2020
Assets
Current Assets
	Answer
Noncurrent Assets
	Answer

c. What amounts would be presented in the income statement for the year ended December 31, 2020, related to this lease?

Note: Round answers to the nearest dollar.

Income Statement	2020
Revenue
	Answer
Interest revenue	Answer
Expenses
	Answer

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