On June 30, 2018, Georgia-Atlantic, Inc., leased warehouse equipment from IC Leasing Corporation. The lease agreement...

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On June 30, 2018, Georgia-Atlantic, Inc., leased warehouseequipment from IC Leasing Corporation. The lease agreement callsfor Georgia-Atlantic to make semiannual lease payments of $403,067over a five-year lease term, payable each June 30 and December 31,with the first payment at June 30, 2018. Georgia-Atlantic’sincremental borrowing rate is 8%, the same rate IC used tocalculate lease payment amounts. IC purchased the equipment fromBuilders, Inc.. at a cost of $3.4 million. (FV of $1, PV of $1, FVAof $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriatefactor(s) from the tables provided.)
Required: 1. What pretax amounts related to the lease would ICreport in its balance sheet at December 31, 2018?
2. What pretax amounts related to the lease would IC report inits income statement for the year ended December 31, 2018?

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On June 30, 2018, Georgia-Atlantic, Inc., leased warehouseequipment from IC Leasing Corporation. The lease agreement callsfor Georgia-Atlantic to make semiannual lease payments of $403,067over a five-year lease term, payable each June 30 and December 31,with the first payment at June 30, 2018. Georgia-Atlantic’sincremental borrowing rate is 8%, the same rate IC used tocalculate lease payment amounts. IC purchased the equipment fromBuilders, Inc.. at a cost of $3.4 million. (FV of $1, PV of $1, FVAof $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriatefactor(s) from the tables provided.)Required: 1. What pretax amounts related to the lease would ICreport in its balance sheet at December 31, 2018?2. What pretax amounts related to the lease would IC report inits income statement for the year ended December 31, 2018?