Each of the four independent situations below describes a sales-type lease in which annual lease payments of $15,000 are payable at the beginning of each year. Each is a finance lease for the lessee. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Lease term (years) Asset's useful life (years) Lessor's implicit rate (known by lessee) Residual value: Purchase option: After (years) Exercise price Guaranteed by lessee Unguaranteed A. B. Reasonably certain? The lessor's: 1. Total lease payments Gross investment in the lease Net investment in the lease 2. 3. The lessee's: 4. 5. 6. Total lease payments Right-of-use asset Lease liability 1 $ 75,000✔ 75,000✔ 59,891 x 1 75,000✔ 59,891 X 59,891 X 5 5 8% 0 none n/a n/a 2 Situation $ 6,000 0 Determine the following amounts at the beginning of the lease: (Round your final answers to nearest whole dollar.) 2 5 4 $ 8,000 no Answer is complete but not entirely correct. Situation 6 8% 81,000 81,000 63,974 X 81,000 X 63,974 X 63,974 X 3 $ 3,000 $3,000 3 5 6 8% 5 $ 2,000 no 78,000 X 81,000✔ 63,974 X 78,000 X 61,933 X 61,933 x 4 $ 6,000 4 5 $ 4,000 yes 49,000✔ 55,000 46,593 8 8% * 49,000 X 41,830 x 41,830 x
Each of the four independent situations below describes a sales-type lease in which annual lease payments of $15,000 are payable at the beginning of each year. Each is a finance lease for the lessee. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Lease term (years) Asset's useful life (years) Lessor's implicit rate (known by lessee) Residual value: Purchase option: After (years) Exercise price Guaranteed by lessee Unguaranteed A. B. Reasonably certain? The lessor's: 1. Total lease payments Gross investment in the lease Net investment in the lease 2. 3. The lessee's: 4. 5. 6. Total lease payments Right-of-use asset Lease liability 1 $ 75,000✔ 75,000✔ 59,891 x 1 75,000✔ 59,891 X 59,891 X 5 5 8% 0 none n/a n/a 2 Situation $ 6,000 0 Determine the following amounts at the beginning of the lease: (Round your final answers to nearest whole dollar.) 2 5 4 $ 8,000 no Answer is complete but not entirely correct. Situation 6 8% 81,000 81,000 63,974 X 81,000 X 63,974 X 63,974 X 3 $ 3,000 $3,000 3 5 6 8% 5 $ 2,000 no 78,000 X 81,000✔ 63,974 X 78,000 X 61,933 X 61,933 x 4 $ 6,000 4 5 $ 4,000 yes 49,000✔ 55,000 46,593 8 8% * 49,000 X 41,830 x 41,830 x
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
7
Transcribed Image Text:Each of the four independent situations below describes a sales-type lease in which annual lease payments of $15,000 are payable at
the beginning of each year. Each is a finance lease for the lessee. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1)
(Use appropriate factor(s) from the tables provided.)
Lease term (years)
Asset's useful life (years)
Lessor's implicit rate (known by lessee)
Residual value:
Purchase option:
After (years)
Exercise price
Guaranteed by lessee
Unguaranteed
A.
B.
Reasonably certain?
The lessor's:
1.
Total lease payments
Gross investment in the
lease
Net investment in the lease
2.
3.
The lessee's:
4.
5.
6.
Total lease payments
Right-of-use asset
Lease liability
1
$ 75,000✔
75,000✔
59,891 x
1
75,000✔
59,891 X
59,891 X
5
5
8%
0
none
n/a
n/a
2
Situation
$ 6,000
0
Determine the following amounts at the beginning of the lease: (Round your final answers to nearest whole dollar.)
2
5
4
$ 8,000
no
Answer is complete but not entirely correct.
Situation
6
8%
81,000
81,000
63,974 X
81,000 X
63,974 X
63,974 X
3
$ 3,000
$3,000
3
5
6
8%
5
$ 2,000
no
78,000 X
81,000✔
63,974 X
78,000 X
61,933 X
61,933 x
4
$ 6,000
4
5
$ 4,000
yes
49,000✔
55,000
46,593
8
8%
*
49,000 X
41,830 x
41,830 x
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