On January 1, 2010, a city entered into the following leases for equipment items. Each of the leases qualifies as a capital lease. Initial payments are on December 31, 2010. An interest rate of 10 percent is viewed as appropriate. No bargain purchase options exist.
Fund | Annual Payments | Total Payments | Present Value of Total Payments |
General (5-year life) | $8,000 | $40,000 | $33,350 |
Enterprise (6-year life) | 6,000 | 36,000 | 28,750 |
a. What balances should be reported on government-wide financial statements for December 31, 2010, and the year then ended?
b. What balances should be reported on fund-based financial statements for December 31, 2010, and the year then ended?
We need at least 10 more requests to produce the solution.
0 / 10 have requested this problem solution
The more requests, the faster the answer.