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On January 1, 2019, Madison Company signed a four-year lease that qualifies as a finance lease requiring annual payments of $15,000 with the first payment
On January 1, 2019, Madison Company signed a four-year lease that qualifies as a finance lease requiring annual payments of $15,000 with the first payment due on January 1, 2019. The fair value of the equipment leased was $50,000. Madison's incremental borrowing rate was 6%. Compound interest information for 6% follows: Present value of annuity due of $1 Present value of ordinary annuity of $1 $55,095 $50,000 $48,185 3 Periods 4 Periods $51,977 2.833393 3.673012 Assuming the lease qualifies as a finance lease, what amount should be recorded as right-of-use on January 1, 2019 (rounded to the nearest dollar)? 5 Periods 4.465106 2.673012 3.465106 4.212364
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