14. Aileen Company acquired an equipment for P2,300,000. At the beginning of current year, the entity leased this equipment for a period of six years, after which, title to the machine is transferred to the lessee. The equipment is so specialized in nature that only the lessee can exclusively benefit from it. The six annual lease payments are due in advance at the beginning of each lease year. The equipment is expected to fall at P200,000 at the end of its useful life which represents the amount it can be sold therefrom. A return of 12% is designed on the lease such that the lessor will earn an amount equal to this rate. What is the annual lease rental payable in advance? Round off present value factors to two decimal places. * a. P500,000 b. P477,826 c. P383,333 d. P460,000
14. Aileen Company acquired an equipment for P2,300,000. At the beginning of current year, the entity leased this equipment for a period of six years, after which, title to the machine is transferred to the lessee. The equipment is so specialized in nature that only the lessee can exclusively benefit from it. The six annual lease payments are due in advance at the beginning of each lease year. The equipment is expected to fall at P200,000 at the end of its useful life which represents the amount it can be sold therefrom. A return of 12% is designed on the lease such that the lessor will earn an amount equal to this rate. What is the annual lease rental payable in advance? Round off present value factors to two decimal places. * a. P500,000 b. P477,826 c. P383,333 d. P460,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![14. Aileen Company acquired
an equipment for P2,300,00o.
At the beginning of current
year, the entity leased this
equipment for a period of six
years, after which, title to the
machine is transferred to the
lessee. The equipment is so
specialized in nature that only
the lessee can exclusively
benefit from it. The six annual
lease payments are due in
advance at the beginning of
each lease year. The
equipment is expected to fall
at P200,000 at the end of its
useful life which represents
the amount it can be sold
therefrom. A return of 12% is
designed on the lease such
that the lessor will earn an
amount equal to this rate.
What is the annual lease rental
payable in advance? Round off
present value factors to two
decimal places. *
a. P500,000
b. P477,826
c. P383,333
d. P460,000
e. None of the above](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1ce944e9-85f1-412c-b932-1e9908226687%2F2b9c6a6a-bb60-41b7-9b58-ea5c8f04d025%2F6ch4sl_processed.jpeg&w=3840&q=75)
Transcribed Image Text:14. Aileen Company acquired
an equipment for P2,300,00o.
At the beginning of current
year, the entity leased this
equipment for a period of six
years, after which, title to the
machine is transferred to the
lessee. The equipment is so
specialized in nature that only
the lessee can exclusively
benefit from it. The six annual
lease payments are due in
advance at the beginning of
each lease year. The
equipment is expected to fall
at P200,000 at the end of its
useful life which represents
the amount it can be sold
therefrom. A return of 12% is
designed on the lease such
that the lessor will earn an
amount equal to this rate.
What is the annual lease rental
payable in advance? Round off
present value factors to two
decimal places. *
a. P500,000
b. P477,826
c. P383,333
d. P460,000
e. None of the above
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