Question $1$:

Mid$-$South Auto Leasing leases vehicles to consumers. The attraction to customers is that the company can offer competitive prices due to volume buying. On September $30,2024,$ the company leased a delivery truck to a local florist, Anything Grows.

The fiscal year for both companies ends December $31.$

The lease agreement specified quarterly payments of $$3,000$ beginning September $30,2024,$ the beginning of the lease, and each quarter $($December $31,$ March $31,$ and June $30)$ through June $30,2027($three$-$year lease term$).$

The florist had the option to purchase the truck on September $29,2026,$ for $$6,000$ when it was expected to have a fair value of $$10,000.$

The estimated useful life of the truck is four years.

Mid$-$South Auto Leasing's quarterly interest rate for determining payments was $3\%($approximately $12\%$ annually$).$

Mid$-$South paid $$25,000$ for the truck.

Both companies use straight$-$line depreciation or amortization. Anything Grows' incremental interest rate is $12\%.$