A lessee company signed a lease for equipment from a lessor on January 1, Year 1....
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A lessee company signed a lease for equipment from a lessor on January 1, Year 1. The lease requires equal rental payments of $42,340 at the beginning of each year of the term. The PV of the lease payments is $245,110. The company pays all executory costs directly to third parties. The appropriate interest rate is 12.49%. Assume ASPE applies. Both the lessor and lessee have December 31 year ends. How much total expense will be recorded by the lessee in its books in Year 1 in relation to this lease assuming the lease is classified as an operating lease? If applicable, include interest, depreciation, and rent in the expense calculation. O a. $40,223 O b. $41,282 O c. $42,340 O d. $44,457 O e. $43,399 A lessee company signed a lease for equipment from a lessor on January 1, Year 1. The lease requires equal rental payments of $42,340 at the beginning of each year of the term. The PV of the lease payments is $245,110. The company pays all executory costs directly to third parties. The appropriate interest rate is 12.49%. Assume ASPE applies. Both the lessor and lessee have December 31 year ends. How much total expense will be recorded by the lessee in its books in Year 1 in relation to this lease assuming the lease is classified as an operating lease? If applicable, include interest, depreciation, and rent in the expense calculation. O a. $40,223 O b. $41,282 O c. $42,340 O d. $44,457 O e. $43,399
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Related Book For
Modern Advanced Accounting in Canada
ISBN: 978-1259087554
7th edition
Authors: Hilton Murray, Herauf Darrell
Posted Date:
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