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Calculate the annual lease payments due from the lessor, and prepare lease amortization schedule, for each of the following scenarios: Scenario A B C Lease
Calculate the annual lease payments due from the lessor, and prepare lease amortization schedule, for each of the following scenarios:
Scenario
A B C
Lease Term 10 Years 20 Years 4 Years
Fair Value of Lease Asset $600,000 $700,000 $100,000
Lesse's Incremental Borrowing Rate 12% 10% 10%
Lessor's Rate of Return (known by lessee) 11% 9% 12%
Payment Due End of Year End of Year End of Year
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