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Question - The following information relates to Wilson, Inc.'s equipment lease with an inception date of January 1:
Fair value of equipment at lease inception, $91,200
Lease term, 4 years
Economic life of property, 5 years
Implicit interest rate, 6%
Annual lease payment clue on December 31, $25,600
Present value of the lease payments, $88,707
The equipment reverts back to the lessor at the end of the lease term. By how much does the lease liability decrease during the first year?
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