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HP Leasing Company recently leased machinery to Alaska Building Associates. The 5 - year lease contract requires rental payments of $ 2 8 , 0

HP Leasing Company recently leased machinery to Alaska Building Associates. The 5-year lease contract requires rental payments of $28,000 on January 1 of each year. The lease meets at least one of the Group I criteria. The 8% implicit rate on the lease is known to Alaska Building Associates There is a $5,600 guaranteed residual value by the lessee, which is equal to the expected residual value at the end of the lease term. Therefore, there is no unguaranteed residual asset. Compute the present value of the lease payments for HP Leasing Company and Alaska Building.
Future Value of $1 table Future Value of an Ordinary Annuity table
Future Value of an Annuity Due table
Present Value of $1 table Present Value of an Ordinary Annuity table
Present Value of an Annuity Due table
(Use the present value and future value tables, the formula method, a financial calculator, or a spreadsheet for your calculation. If using present and future value tables or the formula method, use
Present value (PV) of the lease payments for HP Leasing Company
Present value (PV) of the lease payments for Alaska Building Associates
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