Business
Business, 16.04.2020 03:20, tiadenae22ovtxdr

Each of the four independent situations below describes a finance lease in which annual lease payments are payable at the beginning of each year. The lessee is aware of the lessor’s implicit rate of return. (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) 4 7 5 8 Lessor's rate of return 10 % 11 % 9 % 12 % Fair value of lease asset $ 50,000 $ 350,000 $ 75,000 $ 465,000 Lessor's cost of lease asset $ 50,000 $ 350,000 $ 45,000 $ 465,000 Residual value: Estimated fair value 0 $ 50,000 $ 7,000 $ 45,000 Guaranteed fair value 0 0 $ 7,000 $ 50,000 Required: a. & b. Determine the amount of the annual lease payments as calculated by the lessor and the amount the lessee would record as a right-of-use asset and a lease liability, for each of the above situations. (Round your answers to the nearest whole dollar amount.)

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