CS CW OT On 1/31/Y1, Bailey Company leased a new machine from Sussex Corp. The following data relate to the lease transaction at its Inception: Lease term Annual rental payable at beginning of each lease year Useful life of machine Implicit interest rate Present value of an annuity of 1 in advance for 10 periods at 10% Present value of annuity of 1 in arrears for 10 periods at 10% Fair value of the machine Depreciation method 10 years $50,000 15 years 10% 6.76 Save forlater 6.15 $400,000 Straight line The lease has no renewal option, the possession of the machine reverts to Sussex when the lease terminates, and the machine does have alternative uses. The first lease payment of $50,000 is paid at the inception of the lease. What amount does Sussex Corp. report for depreciation expense in year 1? O $33,800 O $26,667 O $40,000 O $0. Because Bailey, the lessee records a lease liability, Bailey also records depreciation expense