What is the lease expense that Mando will record at the end of each year of the lease? (Round to the nearest whole dollar.)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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7

Mando Co. leased a piece of
nonspecialized equipment for use
in its operations from Empire
Leasing on January 1, 2019. The 4
year lease requires annual lease
payments of $247, beginning on
January 1, 2019. The lease
qualifies as an operating lease for
the lessee. Mando's incremental
borrowing rate is 11%. Mando
incurred initial direct costs of $81.
What is the lease expense that
Mando will record at the end of
each year of the lease? (Round to
the nearest whole dollar.)
Transcribed Image Text:Mando Co. leased a piece of nonspecialized equipment for use in its operations from Empire Leasing on January 1, 2019. The 4 year lease requires annual lease payments of $247, beginning on January 1, 2019. The lease qualifies as an operating lease for the lessee. Mando's incremental borrowing rate is 11%. Mando incurred initial direct costs of $81. What is the lease expense that Mando will record at the end of each year of the lease? (Round to the nearest whole dollar.)
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