Logi sells large-screen monitors. Logi leases monitors to AdScreens on January 1, 2021. The cost of manufacturing the monitors was $18 million. This noncancelable lease had the following terms: Lease payments: $3,254,908 semiannually; first payment at January 1, 2021; remaining payments at June 30 and December 31 each year through June 30, 2025. Lease term: 5 years (10 semiannual payments). No residual value; no purchase option. Economic life of equipment: 5 years. Implicit interest rate and lessee's incremental borrowing rate: 10% semiannually. Fair value of the monitors at January 1, 2021: $22 million. What is the outstanding balance of the lease liability in AdScreens's June 30, 2021, balance sheet? (Round your answer to the nearest whole dollar.)
Logi sells large-screen monitors. Logi leases monitors to AdScreens on January 1, 2021. The cost of manufacturing the monitors was $18 million. This noncancelable lease had the following terms: Lease payments: $3,254,908 semiannually; first payment at January 1, 2021; remaining payments at June 30 and December 31 each year through June 30, 2025. Lease term: 5 years (10 semiannual payments). No residual value; no purchase option. Economic life of equipment: 5 years. Implicit interest rate and lessee's incremental borrowing rate: 10% semiannually. Fair value of the monitors at January 1, 2021: $22 million. What is the outstanding balance of the lease liability in AdScreens's June 30, 2021, balance sheet? (Round your answer to the nearest whole dollar.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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15. Logi sells large-screen monitors. Logi leases monitors to AdScreens on January 1, 2021. The cost of manufacturing the monitors was $18 million.
This noncancelable lease had the following terms:
- Lease payments: $3,254,908 semiannually; first payment at January 1, 2021; remaining payments at June 30 and December 31 each year through June 30, 2025.
- Lease term: 5 years (10 semiannual payments).
- No residual value; no purchase option.
- Economic life of equipment: 5 years.
- Implicit interest rate and lessee's incremental borrowing rate: 10% semiannually.
- Fair value of the monitors at January 1, 2021: $22 million.
What is the outstanding balance of the lease liability in AdScreens's June 30, 2021,
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