Computing Lease Payment-Lessor; Computing Right-of-Use Asset and Lease Liability-Lessee Information for four separate finance/sales-type lease scenarios is provided as follows: Complete the table, rounding your answers to the nearest whole dollar. A B C D Lessor's desired rate of return 6% 7% 8% 7.50% Implicit rate known by the lessee yes no yes no Lessee's incremental borrowing rate 7% 6% 7% 8% Lease term 5 8 5 8 Fair value of underlying asset $200,000 $90,000 $550,000 $36,000 Beginning or end of year payments Beginning Beginning Beginning End Lessor's lease payment $44,791.77 $14,086.07 $127,547.27 $6,146.17 Lessee's lease liability balance Lessee's right-of-use asset balance $200,000.00 ? $200,000.00? 550000? 550000?
Computing Lease Payment-Lessor; Computing Right-of-Use Asset and Lease Liability-Lessee Information for four separate finance/sales-type lease scenarios is provided as follows: Complete the table, rounding your answers to the nearest whole dollar. A B C D Lessor's desired rate of return 6% 7% 8% 7.50% Implicit rate known by the lessee yes no yes no Lessee's incremental borrowing rate 7% 6% 7% 8% Lease term 5 8 5 8 Fair value of underlying asset $200,000 $90,000 $550,000 $36,000 Beginning or end of year payments Beginning Beginning Beginning End Lessor's lease payment $44,791.77 $14,086.07 $127,547.27 $6,146.17 Lessee's lease liability balance Lessee's right-of-use asset balance $200,000.00 ? $200,000.00? 550000? 550000?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Computing Lease Payment-Lessor; Computing Right-of-Use Asset and Lease Liability-Lessee
Information for four separate finance/sales-type lease scenarios is provided as follows:
Complete the table, rounding your answers to the nearest whole dollar.
A
B
C
D
Lessor's desired rate of return
6%
7%
8%
7.50%
Implicit rate known by the lessee
yes
no
yes
no
Lessee's incremental borrowing rate
7%
6%
7%
8%
Lease term
5
8
5
8
Fair value of underlying asset
$200,000
$90,000
$550,000
$36,000
Beginning or end of year payments
Beginning
Beginning
Beginning
Lessor's lease payment
$44,791.77 $14,086.07 $127,547.27
End
$6,146.17
Lessee's lease liability balance
$200,000.00 ?
550000?
Lessee's right-of-use asset balance
$200,000.00 ?
550000 ?
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