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stion 13 (1 point) On January 1, 2020, Lessor Corp. entered into a contract to lease an equipment to Lessee Co. with the following terms:
stion 13 (1 point) On January 1, 2020, Lessor Corp. entered into a contract to lease an equipment to Lessee Co. with the following terms: The lease term is five years, with payments due on the first day of the year. The first payment is due on January 1, 2020. The equipment has a FV of $300,000 on January 1, 2020. There is no BPO or guaranteed residual value at the end of the lease. Lessee has an BR of 9%, and Lessee is aware of Lessor's rate of 10%. The equipment has an estimated useful life of six years. Both the lessor and the lessee use straight-line amortization. The annual lease payment equals $70,733, which includes a $4,000 reimbursement to Lessor for insurance costs paid by the lessor to the insurance company. Both Lessor and Lessee report under ASPE. What is the PV of the minimum lease payments for this lease? a) $299,888 BGN Fv= b) $282,929 c) $294,947 W- 11 y erop to PMT CPT PV O d) $278,268 estion 14 (1 point) Off Books Inc. (OBI) leases a piece of sanding machinery to a lessee on March 20, 2020 the details of the arrangement are as follows: The lease term is five years. The payments of $13.190 are due annually on March 20 each year. The first Question 12 (1 point) On March 31, 2020, the lease agreement Mega Corp. had with Lease Co. expired. The lease had originally been for eight years. At the lease's inception, the asset was expected to have a useful life of 12 years. The lease arrangement had a BPO that gave Mega the option to purchase the asset for $15,000 at the end of the lease term. At March 31, prior to the BPO payment, Mega had the following accounts and balances related to this lease: ROU asset $75,000 Accumulated depreciation $50,000 Lease liability $15,000 Which statement describes how Mega will derecognize the lease if Mega chooses to pay the BPO? ole a) The lease liability will continue to be recognized until the end of the ROU asset's life. Ant noord nce The ROU asset will remain on Mega's records and be increased to its FV when b) the lease is derecognized. c) Mega will record a gain or loss equal to the difference between the carrying value of the ROU asset and the BPO amount. X d) No gain or loss is recorded on derecognition of the lease
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