2021. The lease term is for ten (10) years with equal annual rental payments of $8,000 at the beginning of each year. In addition, Drew has the option to purchase the equipment at the end of the lease term for 55,000. It is reasonably certain that Drew will exercise this purchase option. At the outset of the lease term the equipment has a useful ife of avelve (12) years and a fair value of $56.000. The implicit rate of the lease is not known to Drew Drew/'s incremental borrowing rate is 12% Calculate the amount that Drew should record for the right-of-use asset and the lease liability (Round to the nearest dollar. To get partial edit, show your calculations.)
2021. The lease term is for ten (10) years with equal annual rental payments of $8,000 at the beginning of each year. In addition, Drew has the option to purchase the equipment at the end of the lease term for 55,000. It is reasonably certain that Drew will exercise this purchase option. At the outset of the lease term the equipment has a useful ife of avelve (12) years and a fair value of $56.000. The implicit rate of the lease is not known to Drew Drew/'s incremental borrowing rate is 12% Calculate the amount that Drew should record for the right-of-use asset and the lease liability (Round to the nearest dollar. To get partial edit, show your calculations.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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