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At what amount would the lease obligation be presented

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Question - Koffman and Sons signed a four-year lease for a forklift on January 1, 2017. Annual lease payments of $1,257, based on an interest rate of 6%, are to be made every December 31, beginning with December 31, 2017. Explain why the value of the leased asset is not recorded at $5,028 ($1,257 x 4). The leased asset should be reported at the present value of the payments which is $4,356 not at $5,028. At what amount would the lease obligation be presented on the balance sheet as of December 31, 2017? Round answers to the nearest whole dollar. Current liability portion? Long-term liability portion?

Reference no: EM132573600

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