financial position as of December 31, 20x1 reported a lease liability of P1,066,986, net of current portion. Lease payments of P200,000 are due every January 1st of the year. Calm Co.s incremental borrowing rate is 11% and the lessor's implicit rate, which is known to Calm Co., is 10%. What amount of lease liability, net of current portion, should Calm Co. report on December 31, 20x2? a. 871,052 b. 973,685 c. 986,986 d. 1,066,986

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Leasing

Leasing is a contractual arrangement in which someone (a lessee) pays the owner (or lessor) of a building, land, vehicle, or other asset for the use of that asset. The lease is the agreement between lessee and lessor.