Wildhorse Company, a machinery dealer, leased a machine to Blossom Corporation on January 1, 2025. The lease is for an 8-year period and requires equal annual payments of $32,055 at the beginning of each year. The first payment is received on January 1, 2025. Wildhorse had purchased the machine during 2024 for $129,000. Collectibility of lease payments by Wildhorse is probable. Wildhorse set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Wildhorse at the termination of the lease. Click here to view factor tables. (a) * Your answer is incorrect. Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to O decimal places e.g. 5,275.) Amount of the lease receivable 256440

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Wildhorse Company, a machinery dealer, leased a machine to Blossom Corporation on January 1, 2025. The lease is for an 8-year
period and requires equal annual payments of $32,055 at the beginning of each year. The first payment is received on January 1, 2025.
Wildhorse had purchased the machine during 2024 for $129,000. Collectibility of lease payments by Wildhorse is probable.
Wildhorse set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and
reverts to Wildhorse at the termination of the lease.
Click here to view factor tables.
(a)
* Your answer is incorrect.
Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided
and round final answer to O decimal places e.g. 5,275.)
Amount of the lease receivable
256440
Transcribed Image Text:Wildhorse Company, a machinery dealer, leased a machine to Blossom Corporation on January 1, 2025. The lease is for an 8-year period and requires equal annual payments of $32,055 at the beginning of each year. The first payment is received on January 1, 2025. Wildhorse had purchased the machine during 2024 for $129,000. Collectibility of lease payments by Wildhorse is probable. Wildhorse set the annual rental to ensure a 6% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Wildhorse at the termination of the lease. Click here to view factor tables. (a) * Your answer is incorrect. Compute the amount of the lease receivable. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round final answer to O decimal places e.g. 5,275.) Amount of the lease receivable 256440
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