On January 1, 2014, Watson Company signed a four-year lease requiring annual payments of $45,000, with the first payment due on January 1, 2014. Watson's incremental borrowing rate was 7%. Actuarial information for 7% follows: 
Assuming the lease qualifies as a capital lease, what amount should be recorded as leased equipment under capital leases on January 1, 2014 (rounded to the nearest dollar) ?
Definitions:
Real Wages
Wages adjusted for inflation, representing the purchasing power of the income received by workers for their labor.
Wage Differentials
The variations in wage rates due to factors like occupation, industry, geographic location, or skills, affecting income distribution among workers.
Productivity
A measure of the efficiency of production, often quantified as the ratio of output to inputs in a manufacturing or production process.
Human Capital
The collective skills, knowledge, or other intangible assets of individuals that can be used to create economic value for the individuals, their employers, or their community.
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