19. The Richmond Corporation has just signed a 144-month lease on an asset with an 18-year life....

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19. The Richmond Corporation has just signed a 144-month lease on an asset with an 18-year life. The minimum lease payments are $3,000 per month ($36,000 per year) and are to be discounted back to the present at an 8 percent annual discount rate. The estimated fair value of the property is $290,000. Should the lease be recorded as a capital lease or an operating lease?

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Foundations Of Financial Management

ISBN: 9780073382388

13th Edition

Authors: Stanley B. Block, Geoffrey A. Hirt, Bartley R. Danielsen

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