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On January $1,2023,$ Sandhill Inc. enters into a $5-$year non$-$cancellable lease with Wilson Ltd$.$ for equipment that has an estimated useful life of $5$ years and a fair value of $$2,064,000.$ Sandhill has an incremental borrowing rate of $8\%$ and Wilson's implicit rate is $6\%.$ Sandhill uses the straight$-$line depreciation method to depreciate assets. Sandhill will make annual lease payments on January $1$ of each year $($with the first payment due at the beginning of the lease$)$ based on the fair value of the equipment. The lease agreement includes a guarantee that Sandhill will take over ownership of the equipment from Wilson for a final payment of $$105,000.$ Both companies adhere to IFRS.

$($a$)$

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Calculate the lease payment Wilson Ltd$.$ will charge Sandhill Inc assuming that there is no mark up on the fair value of the equipment. $($Round present value factor calculations to $4$ decimal places, e$.$g$.12\mathrm{.}5124.)$

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Lease payment

$

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$($b$)$

Calculate the present value of the minimum lease payments. $($Round present value factor calculations to $4$ decimal places, eg$.12\mathrm{.}5124.)$

Present value of lease payments

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