Lessee Company enters into a 6 - year finance lease of non - specialized equipment with Lessor
Question:
Lessee Company enters into a year finance lease of nonspecialized equipment with Lessor Company on January Lessee has agreed to pay $ annually beginning immediately on January The lessor estimates the residual value of the equipment to be $ at lease end, but the lessee has not guaranteed the residual value. The economic life of the asset is years. The lessees incremental borrowing rate is and the lessors implicit rate is not readily determinable by the lessee company.
What is the value of the lease liability on January assuming that the lease is properly classified as a finance lease?
Note: Round your answer to the nearest whole dollar.
Intermediate Accounting
ISBN: 978-0134730370
2nd edition
Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella