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Just need help with what I got wrong, Interest Expense and Lease Liability

Monty Leasing Company agrees to lease equipment to Flounder Corporation on January 1, 2025. The following information relates to the lease agreement. 1. The term of the lease is 7 years with no renewal option, and the machinery has an estimated economic life of 9 years. 2. The cost of the machinery is $523,000, and the fair value of the asset on January 1,2025 , is $758,000. 3. At the end of the lease term, the asset reverts to the lessor and has a guaranteed residual value of $60,000. Flounder estimates that the expected residual value at the end of the lease term will be $60,000. Flounder amortizes all of its leased equipment on a straight-line basis. 4. The lease agreement requires equal annual rental payments, beginning on January 1, 2025. 5. The collectibility of the lease payments is probable. 6. Monty desires a 10% rate of return on its imvestments. Flounder's incremental borrowing rate is 11%, and the lessor's implicit rate is unknown. (Assume the accounting period ends on December 31.) Calculate the amount of the annual rental payment required. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,972.) Annual rental payment $ eTextbook and Media List of Accounts Attempts: 1 of 4 used c) Your answer is correct. Compute the value of the lease liability to the lessee. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and the final answer to 0 decimal places e.g. 58,972.) Present value of minimum lease payments $ Date Account Titles and Explanation Light-of-Use Asset Lease Liability (To record the lease.) 1/25 Lease Liability Cash (To record lease payment.) /31/25 Amortization Expense Right-of-Use Asset (To record amortization.) 131/25 Interest Expense Lease Liability (To record interest.) L/26 Lease Liability Cash Amortization Expense Right-of-Use Asset (To record amortization.) /31/26 Interest Expense Lease Liability Debit Credit 101468 101468 101468 101468

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