Lessor rents a machine, cost of RO 60,000, to Lessee for 3 years on January 1, 2000. The salvage value at that time is RO 10,000, which is unguaranteed. The interest rate, known to both parties, is 10% and the lease meets all the requirements needed to qualify as a capital lease. Lessor would calculate the annual rental as RO 19,187.03 (assume the selling price is also RO 60,000) Lessor rents a machine, cost of RO 60,000, to Lessee for 3 years on January 1, 2000. The salvage value at that time is RO 10,000, which is unguaranteed. The interest rate, known to both parties, is 10% and the lease meets all the requirements needed to qualify as a capital lease. Lessor would calculate the annual rental as RO 19,187.03 (assume the selling price is also RO 60,000)