The following facts pertain to a non-cancelable lease agreement between Cullumber Leasing Company and Marin Company, a lessee. Commencement date May 1, 2020 Annual lease payment due at the beginning of each year, beginning with May 1, 2020 $17,865.02 Bargain purchase option price at end of lease term $7,000 Lease term 5 years Economic life of leased equipment 10 years Lessor's cost $65,000 Fair value of asset at May 1, 2020 $85,000 Lessor's implicit rate 6 % Lessee's incremental borrowing rate 6 % The collectibility of the lease payments by Cullumber is probable. Click here to view factor tables. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.)