On January 1, 2020, Hawkeye Airleased a new airplane for 5years. The expected life of the airplane is 20years. The lease stipulates that Hawkeye Air makes annual payments of $1,085,923 payable at the beginningof each year. Hawkeye Airhas anincremental borrowing rate of 4.3%.Hawkeye Air has an option to renew the lease with a 2% increase in the lease payment. a. How will the lease be classified and how do you know?
b. Calculate the present value of the lease payment.
c. What is the balance sheet impact of the lease at the beginning of the lease (1/1/2020)?
d. What is the income statement impact of the lease for 2020?
e. Identify any effects the lease arrangement and the associated reporting would have on the statement of cash flows for 2020.

Anew japanese restaurant opens two blocks from your home. the owner, reiko, is a personal friend of yours. you don't particularly like japanese food, but you decide to go anyway; however, there is nothing on the menu that sounds appealing. unfortunately, it turns out that most of the people in your town don't like japanese cuisine either. reiko confides that business is not good, but she isn't sure what to do from an economic standpoint. which of the following would most likely describe adam smith's perspective on this problem? select one: a. reiko should ask the government for assistance. b. reiko should close the restaurant and find a different career. c. reiko should lay off workers and do everything herself to save money. d. reiko should add other foods to the menu and offer discounts to attract more people to her restaurant.