7 Use the following information for questions 7 and 9 On January 1, 2016. Yancey, Inc signs a 10-year noncancelable fease agreement to lose a storage building from Holt Warehouse Company The following information pertains to this lease agreement (a) The agreement requires equal rental payments at the beginning of each year () The fair value of the building on January 1, 2016 is $5,000,000, however, the book value to Holt is $4,300,000 (c) The building has an estimated economic life of 10 years. Holt estimates a total residual value of $50,000 for the building at the end of the lease form. Yancey guarantees a residual value of $20,000 for Holt. Yancey depreciates similar buildings on the straight-line method (d) Yancey's incremental borrowing rate is 11% per year. Holt Warehouse Co. set the annual rental to insure a 10% rate of retum. The implicit rate of the lessoris known by Yancey, Inc. The present value of an ordinary annuity of 1 for nine years at 10% is 5.75902. The present value of an ordinary annuity of 1 for nine years at 11% is 5.53705. The present value of at the end of ten years at 10% is 0.36554. The present value of 1 at the end of ten years at 118 80.35218.7. What is the amount of the minimum annual lease payment? (Rounded to the nearest dolar) 7. What is the amount of the minimum annual lease payment? (Rounded to the nearest dollar) a $763,794 O $762.177 Ce $736,000 Cd. 5738.611 Submit 8 . From the lessor's viewpoint, what type of dease in involved? a. Sales-type lease, b. Sale-leaseback c. Direct-financing lease d. Operating lease Anos 2014 9 Yancey, Inc. would record depreciation experice on this storage building in 2016 of (Rounded to the nearest dolar) w $0 Ob 5396,229 Ca. 5408,843 Od: $500,000 Submit 7 Use the following information for questions 7 and 9 On January 1, 2016. Yancey, Inc signs a 10-year noncancelable fease agreement to lose a storage building from Holt Warehouse Company The following information pertains to this lease agreement (a) The agreement requires equal rental payments at the beginning of each year () The fair value of the building on January 1, 2016 is $5,000,000, however, the book value to Holt is $4,300,000 (c) The building has an estimated economic life of 10 years. Holt estimates a total residual value of $50,000 for the building at the end of the lease form. Yancey guarantees a residual value of $20,000 for Holt. Yancey depreciates similar buildings on the straight-line method (d) Yancey's incremental borrowing rate is 11% per year. Holt Warehouse Co. set the annual rental to insure a 10% rate of retum. The implicit rate of the lessoris known by Yancey, Inc. The present value of an ordinary annuity of 1 for nine years at 10% is 5.75902. The present value of an ordinary annuity of 1 for nine years at 11% is 5.53705. The present value of at the end of ten years at 10% is 0.36554. The present value of 1 at the end of ten years at 118 80.35218.7. What is the amount of the minimum annual lease payment? (Rounded to the nearest dolar) 7. What is the amount of the minimum annual lease payment? (Rounded to the nearest dollar) a $763,794 O $762.177 Ce $736,000 Cd. 5738.611 Submit 8 . From the lessor's viewpoint, what type of dease in involved? a. Sales-type lease, b. Sale-leaseback c. Direct-financing lease d. Operating lease Anos 2014 9 Yancey, Inc. would record depreciation experice on this storage building in 2016 of (Rounded to the nearest dolar) w $0 Ob 5396,229 Ca. 5408,843 Od: $500,000 Submit