(a) At the inception of a capital lease, the lessee must
record an asset and a liability based on the PV of the minimum
lease payments. The minimum lease payments are the payments
that lessee is required to make in connection with the leased
property, including rent payments, bargain purchase option, and
guaranteed residual value. Minimum lease payments (MLP) are
recorded at present value. The whole guaranteed residual value
is included in MLP.