Multiple Choice Question 78 Pisa, Inc. leased equipment from Tower Company under a four-year lease requiring equal annual payments of $86,038, with the first payment due at lease inception. The lease does not transfer ownership, nor is there a bargain purchase option. The equipment has a 4-year useful life and no residual value, Pisa, Inc.'s incremental borrowing rate is 10% and the rate implicit in the lease (which is known by Pisa, Inc.) is 8%. Assuming that this lease is properly classified as a finance lease, what is the amount of interest expense recorded by Pisa, Inc. in the first year of the asset's life? 890, 4 periods 3.57710 3.31213 1096,4 periods 3.48 685 3.16986 O $0 O $17,738 O $22,798 O $24,621