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Question Completion Status: On January 1, 20X6, Nellie Corp. (NC) entered into a lease agreement contract that entitled it to use equipment. Details of the
Question Completion Status: On January 1, 20X6, Nellie Corp. (NC) entered into a lease agreement contract that entitled it to use equipment. Details of the contract follow: $60,000 $4,000 5% 6% Lease payment, including the non-lease component Non-lease component (maintenance agreement) induded in lease payment Implicit rate in the lease readily determinable by lessee) Incremental borrowing rate Lease term Economic life of equipment Guaranteed residual value Expected pay out on residual value guarantee Option to purchase First annual payment due 5 years 6 years $10,000 $8,000 No Jan. 1. 20X6 NC accounts for the lease and non-lease components in the contract as separate lease components. What is the amount that NC will record for interest expense for its year-ended December 31, 20X67 Da $10,320 b. $10.951 $13,042 Od $10,242
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