The following facts pertain to a non-cancelable lease agreement between Sheridan Leasing and Skysong Group, a lessee (amounts in thousands).

Commencement date		May 1, 2022
Annual lease payment due at the beginning of
each year, beginning with May 1, 2022		25,385.22
Bargain purchase option price at end of lease term		4,960
Lease term		5	years
Economic life of leased equipment		10	years
Lessors cost		80,600
Fair value of asset at May 1, 2022		112,840
Lessors implicit rate		8	%
Lessees incremental borrowing rate		8	%

The collectibility of the lease payments by Sheridan is probable.

1. Prepare a lease amortization schedule for Skysong for the 5-year lease term.

SKYSONG GROUP (Lessee) Lease Amortization Schedule Interest on Liability Annual Lease Payment Plus BPO Reduction of Lease Liability Date 5/1/22 i W 5/1/22 25,385.22 0 25385.22 5/1/23 25,385.22 6726.33 18658.89 5/1/24 25,385.22 5233.62 20151.60 5/1/25 25,385.22 3621.49 21763.73 5/1/26 25,385.22 1880.39 23504.83 4/30/27 4960 W SKYSONG GROUP (Lessee) Lease Amortization Schedule Interest on Liability je Payment Plus BPO Reduction of Lease Liability Lease Liability i i i \ 109464.37 25,385.22 0 25385.22 84079.15 25,385.22 6726.33 18658.89 65420.26 25,385.22 5233.62 20151.60 45268.66 25,385.22 3621.49 21763.73 23504.93 25,385.22 1880.39 23504.83 4960 W