Each of the four independent situations below describes a sales-type lease in which annual lease payments of
Question:
Each of the four independent situations below describes a sales-type lease in which annual lease payments of $15,500 are payable at the beginning of each year. Each is a finance lease for the lessee. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
Situation 1 2 3 4 Lease term (years) 3 3 3 3 Asset's useful life (years) 3 4 4 6 Lessor's implicit rate (known by lessee) 10% 10% 10% 10%
Residual value:
Guaranteed by lessee 0 $6,200 $3,100 0 Unguaranteed 0 0 $3,100 $6,200
Purchase option:
After (years) none 2 3 3 Exercise price n/a $8,100 $2,100 $4,100 Reasonably certain? n/a no no yes
Determine the following amounts at the beginning of the lease (Round your final answers to nearest whole dollar.)
6. Lease liability.
Intermediate Accounting
ISBN: 978-1260481952
10th edition
Authors: J. David Spiceland, James Sepe , Mark Nelson, Wayne Thomas