0 Question 5 Sandhill Cosmetics, Inc. has entered into a leasing agreement to rent equipment from Pronghorn Leasing services. There is no transfer of title, there is not a bargain purchase option, and the economic life test is not met. Based on the following information, what amount would be used in the 90% test for the present value of the lease payments for the lessee? Annual Payments (1st day of the period) $54100 Lease Term Guaranteed Residual Value Incremental Borrowing Rate (lessor implicit rate is not known) 6%, 5 periods 4.46511 8%, 5 periods 4.31213 5 years PV Annuity Due PV Ordinary Annuity PV Single Sum 10%, 5 periods 4.16986 $14800 8% 4.21236 3.99271 3.79079 0.74726 0.68058 0.62092

Sandhill Cosmetics, Inc. has entered into a leasing agreement to rent equipment from Pronghorn Leasing services. There is no transfer of title, there is not a bargain purchase option, and the economic life test is not met. Based on the following information. what amount would be used in the 90% test for the present value of the lease payments for the lessee? Annual Payments ( 1st day of the period) $54100 PV Annuity Due PV Ordinary Annuity PV Single Sum