Benjamin's Warehouse signed a six-year capital lease or finance lease on January 1, 2017, with payments due

Question:

Benjamin's Warehouse signed a six-year capital lease or finance lease on January 1, 2017, with payments due every December 31. Interest is calculated annually at 10%, and the present value of the minimum lease payments is $13,065.

Required

1. Calculate the amount of the annual payment that Benjamin's must make every December 31.

2. Calculate the amount of the lease obligation that would be presented on the December 31, 2019, balance sheet (after two lease payments have been made).

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...