Exercise 21-11 (Part Level Submission)

The following facts pertain to a non-cancelable lease agreement between Sage Hill Leasing Company and Oriole Company, a lessee.

Commencement date		May 1, 2020
Annual lease payment due at the beginning of
each year, beginning with May 1, 2020		$19,656.69
Bargain purchase option price at end of lease term		$7,000
Lease term		5	years
Economic life of leased equipment		10	years
Lessors cost		$65,000
Fair value of asset at May 1, 2020		$93,000
Lessors implicit rate		6	%
Lessees incremental borrowing rate		6	%

The collectibility of the lease payments by Sage Hill is probable. Click here to view factor tables.

(a)

Compute the amount of the lease receivable at commencement of the lease. (For calculation purposes, use 5 decimal places as displayed in the factor table provided and round answer to 2 decimal places, e.g. 5,275.15.)

Lease receivable at commencement

$

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(b) The parts of this question must be completed in order. This part will be available when you complete the part above.

(c) The parts of this question must be completed in order. This part will be available when you complete the part above.

(d) The parts of this question must be completed in order. This part will be available when you complete the part above.