65. On Jaruary 1, 2025, Yarcey, He. signs a 10-year noncancelable lesse agresrtent to lease a storage bulbing from Holt Warehouse Company. Collectibility of lease payments 20 - 14 Test Bank for lntermedlate Aocounting. Elghteenth Edition is reasonably predictable and no important uncertainties surround the amount of oosts yet to be incurred by the kessor. The following infomation pertains to this lease agreemont. (a) The agreement requires equal rental payments at the beginning oach year. (b) The fair value of the bulding on January 1, 2025 is $6,000,000; however, the book value to Hoit is \$4,950,000. (c) The bulding has an estimatod eoonomio Ife of 10 years, with no residual value. Yancey deprociabes similar bulidings using the straight-Ine method. (d) At the bermination of the lease, the titie to the bulding will be transierred to the kssse. (e) Yancey's incremental borrowing rate is 11s per yoar. Holt Warohouse Co. sot the annusl rentsl bo srisure a 10% rgle of refarn. The implit rale of the lessor is krown by Yarcey, Inc. (f) The yesrty rertal paymert indudes $15,000 of executory costs relsled bo kaces an the property. What is the totsl annugl lease payment? 8. $272,703 b. $872,703 0. 5887,703 d. 5002.703