On January 1, Year 1, the Timble Corporation (Timble) leases a piece of typical equipment to use for eight years. The equipment has an expected life of ten years and no anticipated salvage value. Timble has an incremental borrowing rate of 5%. Annual payments for this asset are $9,000 with the first payment to be made immediately. Timble records amortization of lease assets based on the straight-line method and interest based on the effective rate method. What amount of amortization expense should Timble record for Year 1
