The lease agreement specifies annual payments of $$28,000$ beginning January $1,2024,$ the beginning of the December $31$ thereafter through $2031.$

The equipment was acquired recently by Crescent at a cost of $$198,000($its fair value$)$ and was expected to ha $12$ years with no salvage value at the end of its life.

Because the lease term is only $9$ years, the asset does have an expected residual value at the end of the lease

Crescent seeks a $11\%$ return on its lease investments.

this arrangement, the lease is deemed to be a finance lease.

ote: Use tables, Excel, or a financial calculator. $($FV of $$1,$ PV of $$1,$ FVA of $$1,$ PVA of $$1,$ FVAD of $$1$ and PVAD of $

equired:

What will be the effect of the lease on Caf$$ Med's earnings for the first year $($ignore taxes$)?$

Note: Enter decreases with negative sign.

What will be the balances in the balance sheet accounts related to the lease at the end of the first year for taxes$)?$

ote: For all requirements, round your intermediate calculations and final answers to the nearest whole dollars.

$\backslash$table$[[1.$ Effect on earnings,$],[2.$ Lease payable balance $($end of year$),],[2.$ Right$-$of$-$use asset balance $($end of year$),]]$