I am having trouble figuring out situation 4 I referred to a similar question and followed their approach for step 1, which was taking the annual lease payments of $19,000 and multiplying it by Lease term (years) 4 and adding Unguaranteed Residual Value $7,600 But it is wrong Question Each of the independent situations below describes a sales type lease in which annual lease payments of $19,000 are payable at the beginning of each year Each is a finance lease for the lessee Situation 4 Lease Term (years) 4 Asset's Useful Life (years) 7 Lessor's Implicit Rate (known by lessee) 12 Residual Value Guaranteed by lessee 0 Unguaranteed $7,600 Purchase options After (years) 3 Exercise Price $4,800 Reasonably certain Yes Determine the following amounts at the beginning of the lease (Round your final answers to nearest whole dollar ) Situation 4 A The Lessors's 1 Lease Payments 2 Gross Investment in the lease 3 Net Investment in the lease B The Lessee's 4 Lease Payments 5 Right of use Asset 6 Lease Payable Each of the four independent situations below describes a sales type lease in which annual lease payments of $19 000 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 2 1 3 4 12 5 120 5 12 4 7 120 0 Lease term (years) Asset's useful life (years) Lessor's implicit rate (known by lessee) Residual value Guaranteed by lessee Unguaranteed Purchase option After (years) Exercise price Reasonably certain $7,600 0 $3,800 $3,800 $7,600 3 none n a n a $8,800 no 4 $2,800 no 3 $4,800 yes Determine the following amounts at the beginning of the lease (Round your final answers to nearest whole dollar ) Situation 1 2 3 S 76,000 76,000 64,635 83,600 83,600 69,465 83,600 83,600 69,465 A The lessor's 1 Lease payments 2 Gross investment in the lease 3 Net investment in the lease B The lessee's 4 Lease payments 5 Right of use asset 6 Lease payable 76,000 64,635 64,635 76,000 64,635 64,635 76,000 64,635 64,635

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Question: I am having trouble figuring out situation #4. I referred to a similar question and followed their approach for step 1, which was taking the

I am having trouble figuring out situation #4. I referred to a similar question and followed their approach for step 1, which was taking the annual lease payments of $19,000 and multiplying it by Lease term (years) 4 and adding Unguaranteed Residual Value $7,600. But it is wrong.

Question:

Each of the independent situations below describes a sales-type lease in which annual lease payments of $19,000 are payable at the beginning of each year. Each is a finance lease for the lessee.

	Situation #4
Lease Term (years)	4
Asset's Useful Life (years)	7
Lessor's Implicit Rate (known by lessee)	12%
Residual Value:
Guaranteed by lessee	0
Unguaranteed	$7,600
Purchase options:
After (years)	3
Exercise Price	$4,800
Reasonably certain?	Yes

Determine the following amounts at the beginning of the lease: (Round your final answers to nearest whole dollar.)

		Situation #4
A	The Lessors's
	1. Lease Payments
	2. Gross Investment in the lease
	3. Net Investment in the lease
B	The Lessee's
	4. Lease Payments
	5. Right-of-use Asset
	6. Lease Payable

I am having trouble figuring out situation #4. I referred to a

Each of the four independent situations below describes a sales-type lease in which annual lease payments of $19.000 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 2 1 3 4 12 5 120 5 12 4 7 120 0 Lease term (years) Asset's useful life (years) Lessor's implicit rate (known by lessee) Residual value: Guaranteed by lessee Unguaranteed Purchase option: After (years) Exercise price Reasonably certain? $7,600 0 $3,800 $3,800 $7,600 3 none n/a n/a $8,800 no 4. $2,800 no 3 $4,800 yes Determine the following amounts at the beginning of the lease: (Round your final answers to nearest whole dollar.) Situation 1 2 3 S 76,000 76,000 64,635 83,600 83,600 69,465 83,600 83,600 69,465 A. The lessor's: 1. Lease payments 2. Gross investment in the lease 3. Net investment in the lease B. The lessee's: 4. Lease payments 5. Right-of-use asset 6. Lease payable 76,000 64,635 64,635 76,000 64,635 64,635 76,000 64,635 64,635

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