Question

2 eBook Print Question 1 Not yet answered Marked out of 2.00 P Flag question Figure 1. Cash Flow Interest Expense Reduction of Lease Liability Balance of Lease Liability Date $230,000 01/01/12 $ (50,000) $180,000 12/31/12 (69,846) А. в $124,554 Figure 1 is an excerpt from the class slides. Assuming a lease contract rate of 8%, what are the numbers in the 12/31/12 row in cells A and B? Select one: o a. A: $230,000 x 8% = $18,400. B: $69,846 - $18,400 = $51,446 O b. A: $180,000 - $69,846 = $110,154. B: $110,154 - $69,846 = $40,308 o c. A: $69,846 x 8% = $5,587.68. B: $69,846 - $5,587.68 = $64.258.32 o d. A: $180,000 x 8% = $14,440. B: $69,846 - $14,400 = $55,446

Answer 1

Interest expense = 180000*8%= $14,400

Reduction of lease liability = 69846-14400= $55446

A: $180,000 X 8% = $14,400. B: $69,846-$14,400 = $55,446

Option D is correct