use 10k to make a cash flow and answer questions. Contractual Obligations or Transaction Flows Attached is
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Question:
use 10k to make a cash flow and answer questions.
Contractual Obligations or Transaction Flows
Attached is the draft lease contract with Gulfstream Aerospace Corporation Pre-Owned Aircraft Sales and Leasing. We are considering this 15 year lease versus purchasing the aircraft for $45,950,000. Our borrowing rate is 7.65%.
Issue(s) Addressed
What is the accounting for this lease contract at inception, during the 15 years, and at termination of the lease? The CEO is interested in owning a plane, but doesn't know if he will optimize its use. He is currently at a 50% likelihood of wanting to own a plane long-term.
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