An entity leases an asset from another entity. The fair value of the asset is $100,000, and the lease rentals are $18,000, payable half yearly. The first payment is made on the delivery of the asset. The unguaranteed residual value of the asset after the three-year lease period is $4,000. The implicit interest rate in the lease is 9.3% (approximately), and the present value of the minimum lease payment is $96,936. 

Required 

Show how this lease would be accounted for in the accounts of the lessee

Answer rating: 100% (QA)

Accounting for the Lease in the Lessees Accounts Heres how the lease would be accounted for in the lessees accounts following the new lease accounting ... View the full answer