On December 31, 2024, Teal Mountain Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called for Teal Mountain to make annual payments of $8,634 at the beginning of each year, starting December 31, 2024. The machine has an estimated useful life of 6 years and a $4,900 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Teal Mountain uses the straight-line method of depreciation for all of its plant assets. Teal Mountain's incremental borrowing rate is 8%, and the lessor's implicit rate is unknown.
On December 31, 2024, Teal Mountain Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called for Teal Mountain to make annual payments of $8,634 at the beginning of each year, starting December 31, 2024. The machine has an estimated useful life of 6 years and a $4,900 unguaranteed residual value. The machine reverts back to the lessor at the end of the lease term. Teal Mountain uses the straight-line method of depreciation for all of its plant assets. Teal Mountain's incremental borrowing rate is 8%, and the lessor's implicit rate is unknown.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 10MC: On August 1, 2019, Kern Company leased a machine to Day Company for a 6-year period requiring...
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![(b)
Your answer is incorrect
Compute the present value of the lease payments. (For calculation purposes, use 5 decimal places as displayed in the factor table
provided and round final answer to 0 decimal ploces eg. 5,275)
Present value of the lease payments
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(c)
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Transcribed Image Text:(b)
Your answer is incorrect
Compute the present value of the lease payments. (For calculation purposes, use 5 decimal places as displayed in the factor table
provided and round final answer to 0 decimal ploces eg. 5,275)
Present value of the lease payments
eTextbook and Media
List of Accounts
Save for Later
S
Attempts: 1 of 3 used Submit Answer
(c)
The parts of this question must be completed in order This part will be available when you complete the part above.
![On December 31, 2024, Teal Mountain Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called
for Teal Mountain to make annual payments of $8,634 at the beginning of each year, starting December 31, 2024. The machine has an
estimated usefullife of 6 years and a $4,900 unguaranteed residual value. The machine reverts back to the lessor at the end of the
lease term. Teal Mountain uses the straight-line method of depreciation for all of its plant assets. Teal Mountain's incremental
borrowing rate is 8%, and the lessor's implicit rate is unknown.
Click here to view factor tables.
(a)
Your answer is correct,
What type of lease is this?
This is a/an france
lease](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F77ce7e64-866e-4556-a115-79fb1f4a3e7d%2Fa927202c-6613-460a-87fd-969a9c45d7ec%2Fj2bs9ng_processed.jpeg&w=3840&q=75)
Transcribed Image Text:On December 31, 2024, Teal Mountain Corporation signed a 5-year, non-cancelable lease for a machine. The terms of the lease called
for Teal Mountain to make annual payments of $8,634 at the beginning of each year, starting December 31, 2024. The machine has an
estimated usefullife of 6 years and a $4,900 unguaranteed residual value. The machine reverts back to the lessor at the end of the
lease term. Teal Mountain uses the straight-line method of depreciation for all of its plant assets. Teal Mountain's incremental
borrowing rate is 8%, and the lessor's implicit rate is unknown.
Click here to view factor tables.
(a)
Your answer is correct,
What type of lease is this?
This is a/an france
lease
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