The following facts pertain to a non-cancelable lease agreement between Alschuler Leasing Company and Buffalo Electronics, a lessee, for a computer system.

Commencement date		October 1, 2020
Lease term		6	years
The economic life of leased equipment		6	years
The fair value of the asset on October 1, 2020		$321,200
Book value of the asset on October 1, 2020		$280,000
Residual value at end of lease term		–0–
Lessor’s implicit rate		11	%
Lessee’s incremental borrowing rate		11	%
Annual lease payment due at the beginning of
each year, beginning with October 1, 2020		$68,400

The collectibility of the lease payments is probable by the lessor. The asset will revert to the lessor at the end of the lease term. The straight-line depreciation method is used for all equipment.

The following amortization schedule has been prepared correctly for use by both the lessor and the lessee in accounting for this lease. The lease is to be accounted for properly as a finance lease by the lessee and as a sales-type lease by the lessor.

Date		Lease Payment/Receipt		Interest (11%) on Unpaid Liability/Receivable		Reduction of Lease Liability/Receivable		Balance of Lease Liability/Receivable
10/01/20								$321,200
10/01/20		$68,400				$68,400		252,800
10/01/21		68,400		$27,808		40,592		212,208
10/01/22		68,400		23,343		45,057		167,151
10/01/23		68,400		18,387		50,013		117,138
10/01/24		68,400		12,885		55,515		61,623
10/01/25		68,400		6,777		61,623		–0–
		$410,400		$89,200		$321,200

Assuming the lessee’s accounting period ends on September 30, answer the following questions with respect to this lease agreement. (Round answers to 0 decimal places e.g. 58,971.)

(1) What items and amounts will appear on the lessee’s income statement for the year ending September 30, 2021?

$27,808
$

(2) What items and amounts will appear on the lessee’s balance sheet at September 30, 2021?

Balance Sheet (Partial)	September 30, 2021
Current Liabilities
	$
Long-Term Liabilities
	$
Non Current Assets
	$

(3) What items and amounts will appear on the lessee’s income statement for the year ending September 30, 2022?

$23,343
$

(4) What items and amounts will appear on the lessee’s balance sheet at September 30, 2022?

Balance Sheet (Partial)	September 30, 2022
Current Liabilities
	$
Long-Term Liabilities
	$
Non-Current Assets
	$