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On January 1, 2020, Kingbird Co. leased a building to Blossom Inc. The relevant information related to the lease is as follows 1. The lease

On January 1, 2020, Kingbird Co. leased a building to Blossom Inc. The relevant information related to the lease is as follows

1. The lease arrangement is for 10 years. The building is expected to have a residual value at the end of the lease of $2,500,000 (unguaranteed).
2. The leased building has a cost of $3,000,000 and was purchased for cash on January 1, 2020.
3. The building is depreciated on a straight-line basis. Its estimated economic life is 50 years with no salvage value.
4. Lease payments are $250,000 per year and are made at the beginning of the year.
5. Blossom has an incremental borrowing rate of 5%, and the rate implicit in the lease is unknown to Blossom.
6.

Both the lessor and the lessee are on a calendar-year basis.image text in transcribed

If Blossom paid $20,000 to a real estate broker on January 1, 2020, as a fee for finding the lessor, what is the initial measurement of the right-of-use asset? Right-of-use asset 1485216.87

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