Question 2 In order to ensure that they successfully earn the full market value of a...
Question 2
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In order to ensure that they successfully earn the full market value of a leased asset, how should the LESSOR calculate the amount of the lease payment?
They should use the market value less the estimated residual value as the PV of the lease payments.
They should use the historical value less the present value of the bargain purchase option as the PV of the lease payments.
They should use the market value less the present value of the estimated residual value as the PV of the lease payments.
They should use the market value of the lease as the PV of the lease payments.
Homework Answers
Solution:
In order to ensure that they successfully earn the full market value of a leased asset, LESSOR should calculate the amount of the lease payment as "They should use the market value less the present value of the estimated residual value as the PV of the lease payments."
Hence 3rd option is correct.
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Question 2
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