Fischer Corporation Leased New Equipment to Swix Company on January $12 / 31 / 15$

Fischer Corporation leased new equipment to Swix Company on January 1,2014.The lease is for an eight-year period and requires equal annual payments of $35,000 due on January 1 of each year.The first payment was made at the inception of the lease.The fair value of the equipment and the present value of the payments was $217,223.The implicit interest rate is 8%.The equipment cost Fischer Corporation $160,000,has an estimated eight-year life,and a residual value of zero.Fischer Corporation uses straight-line depreciation.Fischer Corporation should have recorded the lease as a sales-type lease but mistakenly recorded the lease as an operating lease.
Required:
Determine the amount of the lease classification error on the following financial statement elements of Fischer Corporation,and whether the amount is overstated or understated:
Total assets as of $12 / 31 / 15$ _____
Net Income for the year ended $\mathbf { 1 2 } / \mathbf { 3 1 } / \mathbf { 1 4 }$ ______