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Assume that on December 31, 2024, Ivanhoe Aerospace signs a 8-year, non-cancelable lease agreement to lease a hanger from Aero Field Management Company. The
Assume that on December 31, 2024, Ivanhoe Aerospace signs a 8-year, non-cancelable lease agreement to lease a hanger from Aero Field Management Company. The following information pertains to this lease agreement: 1. The agreement requires equal rental payments of $164,510 beginning on December 31, 2024. 2. The fair value of the building on December 31, 2024 is $1,114,740. 3. The building has an estimated economic life of 10 years, a guaranteed residual value of $50,800, and an expected residual value of $35,700. Ivanhoe depreciates similar buildings on the straight-line method. 4. The lease is nonrenewable. At the termination of the lease, the building reverts to the lessor. 5. Ivanhoe's incremental borrowing rate is 6% per year. The lessor's implicit rate is not known by Ivanhoe. Click here to view factor tables. (For calculation purposes, use 5 decimal places as displayed in the factor table provided.) (a) (b) Your answer is incorrect. Suppose the same facts as above, except that Ivanhoe incurred legal fees resulting from the execution of the lease of $12,100, and received a lease incentive from Aero Field to enter the lease of $16,100. At the initial measurement of the lease liability, what would be the amount of lease liability and right-of-use asset? Right-of-use asset $ 1092341
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