On 31 December 2021, Kuhn Corporation leased a plane from Bell Company for a seven-year period expiring 31 December 2028

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On 31 December 2021 Kuhn Corporation Leased A Plane From Bell Company For A Seven Year Period Expiring 31 December 2028 1 (58.52 KiB) Viewed 51 times

On 31 December 2021, Kuhn Corporation leased a plane from Bell Company for a seven-year period expiring 31 December 2028. Equal annual payments of $450,000 are due on December 31 of each year, beginning with 31 December 2021. The present value at 31 December 2021 of the seven lease payments over the lease term discounted at 10%, the implicit interest rate required by Bell Company and known to Kuhn Corporation, is $2,409,867. Kuhn Corporation made the first payment on 31 December 2021. Required: (Support with detailed calculations.) B. Briefly discuss how Kuhn Corporation reports the lease under the liability section on its 31 December 2021 statement of financial position. (8 marks)