1. Technoid Inc. sells computer systems. Technoid leases computers to Lone Star Company in January 1, 2018. The manufacturing cost of the computers was 130,000.

This noncancelable lease had the following terms:

Lease payments: 23,000 semiannually; first payment at January 1, 2018; remaining payments at June 30 and December 31 each year through June 30, 2022.

Lease term: 5 years (10 semiannual payments).

No residual value; no purchase option.

Economic life of equipment: 5 years.

Implicit interest rate and lessee's incremental borrowing rate: 5% semiannually. What is Technoids selling profit?

2. On October 1, 2018, Sonoma Company leased equipment from Napa Inc. in lease payable in five equal annual payments of 500,000, beginning Oct 1, 2018. Similar transactions have carried an 11% interest rate. Sonoma Company expects the residual value at Oct. 1, 2023 to be 30,000. Negotiations led to Sonoma guaranteeing a 50,000 residual value. The right-of-use asset would be recorded ?