Careweezy Autoparts leased an industrial press from Snap-On Tools on January 1, 2021. The lease is for a 3-year period ending December 31, 2023. Annual payments are $42,000 beginning with the first payment on January 1, 2021, and each December 31 through 2022. NAPA has the option to purchase the industrial press on December 30, 2023 for $51,000, and exercise of the option seems reasonably certain. The machine's estimated useful life is 6 years with no salvage value. The implicit rate of return in the lease is 12%. Snap-On initially records the lease receivable at $149,283. What will the balance be in the right-of-use asset account for NAPA Autoparts on December 31, 2022? A. $99,521 B. $45,536 C. $78,157 D. $124,402
Careweezy Autoparts leased an industrial press from Snap-On Tools on January 1, 2021. The lease is for a 3-year period ending December 31, 2023. Annual payments are $42,000 beginning with the first payment on January 1, 2021, and each December 31 through 2022. NAPA has the option to purchase the industrial press on December 30, 2023 for $51,000, and exercise of the option seems reasonably certain. The machine's estimated useful life is 6 years with no salvage value. The implicit
What will the balance be in the right-of-use asset account for NAPA Autoparts on December 31, 2022?
| A. |
$99,521 |
| B. |
$45,536 |
| C. |
$78,157 |
| D. |
$124,402 |
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