Billit Corporation is considering leasing a machine to a client for five years. The machine sells for $100,000 cash. The incremental borrowing rate is 8%. The implicit rate is unknown. Payments are quarterly and start at the commencement of the lease. What is the quarterly lease payment? Show your work. Quarterly Calculation of Initial Lease Liability: Quarterly Payment Non-Lease Component*

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Billit Corporation is considering leasing a machine to a client for five years. The machine sells for $100,000 cash. The incremental borrowing rate is 8%. The implicit rate is unknown. Payments are quarterly and start at the commencement of the lease. What is the quarterly lease payment? Show your work.

Quarterly

Calculation of Initial Lease Liability:

Quarterly Payment

Non-Lease Component*

Minimum Lease Payment

Present Value Factor

Present Value of Mininum Lease Payment

Related Book For  answer-question

Intermediate Accounting

6th edition

Authors: J. David Spiceland, James Sepe, Mark Nelson

ISBN: 978-0077400163