Cullumber Corp., a lessee, entered into a non - cancellable lease agreement with Galt Manufacturing Ltd .
Fantastic news! We've Found the answer you've been seeking!
Question:
Cullumber Corp., a lessee, entered into a noncancellable lease agreement with Galt Manufacturing Ltd a lessor, to lease specialpurpose equipment for a period of seven years. Cullumber follows IFRS and Galt follows ASPE. The following information relates to the agreement:
Lease inception
Annual lease payment due at the beginning of each lease year
Residual value of equipment at end of lease term, guaranteed by an independent third party
May
Economic life of equipment
Usual selling price of equipment
Manufacturing cost of equipment on lessor's books
Lessor's implicit interest rate, known to lessee
Lessee's incremental borrowing rate
Repairs and maintenance per year to be paid by lessee, estimated
$
years
$
$
$
The leased equipment reverts to Galt at the end of the lease, although Cullumber has an option to purchase it at its expected fair value at that time.
Click here to view the factor table PRESENT VALUE OF AN ANNUITY DUE.
Calculate the lease payment determined by the lessor to provide a return. Round factor values to decimal places, eg and final answer to decimal places, eg
Related Book For
Intermediate Accounting
ISBN: 978-0470161012
9th Canadian Edition, Volume 2
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield.
Posted Date: