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QUESTION: 56 On January 1, 2016, Stephen Corp., a lessor, signed a direct financing lease. Stephen was to receive annual year-end payments of $10,000 for ten years, after which there was a guaranteed residual value of $8,000. The implicit interest rate was 8%. Actuarial information for 8%, ten periods follow: Present value of an ordinary annuity of $1 6.71008 Present value of the amount of $1 0.46319 On January 1, 2016, what amount should Stephen record as a debit to Lease Receivable?

QUESTION: 56 On January 1, 2016, Stephen Corp., a lessor, signed a direct financing lease. Stephen was to receive annual year-end payments of $10,000 for ten years, after which there was a guaranteed residual value of $8,000. The implicit interest rate was 8%. Actuarial information for 8%, ten periods follow: Present value of an ordinary annuity of $1 6.71008 Present value of the amount of $1 0.46319 On January 1, 2016, what amount should Stephen record as a debit to Lease Receivable?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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QUESTION: 56 On January 1, 2016, Stephen Corp., a lessor, signed a direct financing lease. Stephen was to receive annual year-end payments of $10,000 for ten years, after which there was a guaranteed residual value of $8,000. The implicit interest rate was 8%. Actuarial information for 8%, ten periods follow: Present value of an ordinary annuity of $1 6.71008 Present value of the amount of $1 0.46319 On January 1, 2016, what amount should Stephen record as a debit to Lease Receivable?
Transcribed Image Text:QUESTION: 56 On January 1, 2016, Stephen Corp., a lessor, signed a direct financing lease. Stephen was to receive annual year-end payments of $10,000 for ten years, after which there was a guaranteed residual value of $8,000. The implicit interest rate was 8%. Actuarial information for 8%, ten periods follow: Present value of an ordinary annuity of $1 6.71008 Present value of the amount of $1 0.46319 On January 1, 2016, what amount should Stephen record as a debit to Lease Receivable?
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