Requirement A - The lessor's | ||||
Situation | ||||
Paticulars | 1 | 2 | 3 | 4 |
Lease Payments | 60000 | 64800 | 62400 | 60000 |
Gross Investment in the Lease | 60000 | 64800 | 64800 | 64800 |
Net Investment in the Lease | 50877 | 53996 | 53996 | 53996 |
Notes: |
Lease Payments=(Annual Lease Payments*No. of Year) + Guaranteed by Lessee |
Gross Investment in Lease=Lease Payments+Estimated Fair value+Guranteed by Lessee |
Net Investment In Lease = PV of annuties + PV of Estimated Fair Value + PV of Guaranteed |
Requirement B - The lessee's | ||||
Situation | ||||
Paticulars | 1 | 2 | 3 | 4 |
Lease Payments | 60000 | 64800 | 62400 | 60000 |
Right of use of asset | 50877 | 53996 | 52436 | 50877 |
Lease liability | 50877 | 53996 | 52436 | 50877 |
Notes: |
Lease Payments=(Annual Lease Payments*No. of Year) + Guaranteed by Lessee |
Right of use of Asset = Lease Liability = PV of annuties + PV of Guaranteed by Lessee |
Each of the four independent situations below describes a sales-type lease in which annual lease payments...
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Each of the four independent situations below describes a sales-type lease in which annual lease payments of $17,000 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 1 2 3 4 Lease term (years) 2 2 2 2 Asset’s useful life (years) 2 3 3 5...
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