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TB MC Qu . 1 5 - 7 2 ( Static ) XYZ Company leased equipment... XYZ Company leased equipment to West Corporation under a

TB MC Qu.15-72(Static) XYZ Company leased equipment...
XYZ Company leased equipment to West Corporation under a lease agreement that qualifies as a finance lease to West, but not as a result of a bargain purchase option or a title transfer. The present value of the
lease payments is $600,000. The expected economic life of the asset is seven years. The lease term is five years. Using the straight-line method, what would West record as annual amortization?
Multiple Choice
$120,000
$85,714
$60,000
$0
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