Question

Each of the four independent situations below describes a sales-type lease in which annual lease payments of $125,000 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 3 7 14% 10% 12% 11% Lease term (years) Lessor's and lessee's interest rate Residual value: Estimated fair value Guaranteed by lessee O $55,000 $8,500 $ 8,500 $55,000 $65,000 Determine the following amounts at the beginning of the lease: (Round your intermediate and final answer to the nearest whole dollar amount.) Situation 1 2 3 4 The lessor's: 1. Total lease payments 2. Gross investment in the lease 3. Net investment in the lease The lessee's: 4. Total lease payments 5. Right-of-use asset 6. Lease liability

Answer 1

working only to lcos tinneortion form lcassor e point Total tranh A2 A3 A4. payment: av 64 74 leosc term 74 1,2 1,000 2.500 100D LEON "rental p.a. 1,25,00D c on tal pia. 10 lun. 10h yokbey 11% un . 2. XX implicit introok made Dpv@ irri Guaranteed Residual Voluci 0 8500 65,000 133,500 V +55000 Totol Ecosc payment : 1,05,000 1,25,000 1,33,500 19000 UGRV : 55,000 • Endoforth Grous investimenti 7,50 DOD 4,50.000 133,500 [Leos period (Ease payment] 9.4000 te UGRV. 8,05.000 9,34,510 (unGurrentced Residuol Valke) (1,25,000x + 69000). : ourotiment : 750,000 8,05,000 9.34,500 9.40.ood, Gross investiment 5113,845 466,00 6,08 500 589,012 Nct investiment: 650oox 8 soov 55000XO.UST 0.513. 6:4816 PV factor alempaynatet UGRV 5,11,025 6,12, 861 6,203165 5.13, EAT

Tempont of www. CURAHAN) (1) lenne noblerty, ly: Bud tot + Vocioble put + Gent penalties & puchong offer price. $1,25000 £1,25,000 + 1 105,000 & 120.000 Teose payment asr of love Il factor @ 64 64 14% 4 100% 4% 12% 4.7121 411 Gebe 3665 - pr poclore like: -(for yoto Yo] 0.513. 0.4816 0.50 0.455 or loctor for end of Perint, 8500 55.000 o 55000 - Residual Voluci . 10.000 at athyes) payable amount by lease) 1,25000 Laruso, Welco 1,0000 polas lease goyment Icode Cinhicity 0.000. - 5, 93,245 (Prefactory leng pay) 5,13, EAT 4.86,000 6,08, 550 lidhoody?

to the lease Right of use of an onetsi Here first cor payment : includes not ceability. options. intid payment @ $ 1,25,000 in toch so, Remaining periods!! AI A As Au (i) No of years Gy 1,26000 1,25,000 lespoo 1,25,000 1,05,000 leve payment ly by intial tece payment & on 5Y PDDDDD 64 Remaining perriods, 127. 147. total pr factor & @ ROR. 10% 4.355 4.23. 3.60 4. 3.433 DCF@ ROR: 125,000x423 4,50,650 + 4.29425 Total Right of al of ancti intial paid .) 10.000 x 0.534 6,69,375 t 1,25,000 1,20,000 11,25,000 5, 45,500 5154,125 6,69,375 6,59,157