Question: Please help with question above Question 1 Sunland, Inc. leased equipment from Tower Company under a 4-year lease requiring equal annual payments of $284152, with

Please help with question above

Question 1 Sunland, Inc. leased equipment from Tower Company under a 4-year lease requiring equal annual payments of $284152, 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 salvage value. Sunland Inc.'s incremental borrowing rate is 11% and the rate implicit in the lease which is known by Sunland, Inc. is 9%. Assuming that this lease is properly classified as a capital lease, what is the amount of principal reduction recorded when the second lease payment is made in Year 2? Annuity 3.23972 3.10245 3.53129 3.44371 11%, 4 periods O $219418 O $284152 O $168270 O $201300

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