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On December 31, 2019, Splish Brothers Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called for Splish Brothers to make annual payments of $8,148 at the beginning of each year, starting December 31, 2019. The machine has an estimated useful life of 6 years and a $5,500 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Splish Brothers uses the straight-line method of depreciation for all of its plant assets. Splish Brotherss incremental borrowing rate is 11%, and the lessors implicit rate is unknown. Click here to view factor tables.

(a) Your answer is correct. What type of lease is this? This is a/an select a type of lease operatingfinance lease. Click if you would like to Show Work for this question: Open Show Work SHOW LIST OF ACCOUNTS SHOW SOLUTION SHOW ANSWER LINK TO TEXT LINK TO TEXT Attempts: 1 of 2 used

(b) Compute the present value of the lease payments. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to 0 decimal places e.g. 5,275.) Present value of the lease payments $enter the Present value of the lease payments in dollars

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