Question
A finance lease agreement calls for quarterly lease payments of $5,500 over a 10-year lease term, with the first payment on July 1, the beginning
A finance lease agreement calls for quarterly lease payments of $5,500 over a 10-year lease term, with the first payment on July 1, the beginning of the lease. The annual interest rate is 8%. Both the present value of the lease payments and the cost of the asset to the lessor are $152,000. Required:
a. Prepare a partial amortization table up to the October 1 payment.
| Date | Lease Pmt | Effective Interest | Decrease in Balance | Outstanding Balance |
|---|---|---|---|---|
| July 1 | ||||
| July 1 | ||||
| October 1 |
b. What would be the amount of interest expense (revenue) the lessee (lessor) would record in conjunction with the second quarterly payment on October 1?
| Interest Expense (lessee) | $ |
| Interest revenue (lessor) | $ |
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Medical Audit In Primary Health Care
Authors: Martin Lawrence, Theo Schofield
1st Edition
0192622676, 978-0192622679
