Hayley, Inc. manufactures machinery used in the mining industry. On January 2, 2018, it leased equipment with a cost of
Posted: Wed Mar 09, 2022 8:24 am
Hayley, Inc. manufactures machinery used in the mining industry.
On January 2, 2018, it leased equipment with a cost of
$200,000.
The 5-year lease calls for an equal annual payment at the
beginning of each year.
The equipment has an expected useful life of 5 years.
If Hayley set the present value of the five lease payments at
$292,500, which is 100% of the fair value of the machinery, and the
rate implicit in the lease is 8%, what are the equal annual
payments?
PV Annuity
Due PV
Ordinary
Annuity
8%, 5
periods
4.31213
3.99271
Select one:
a.
$75,822
b.
$67,831
c.
$73,259
d.
$81,398
On January 2, 2018, it leased equipment with a cost of
$200,000.
The 5-year lease calls for an equal annual payment at the
beginning of each year.
The equipment has an expected useful life of 5 years.
If Hayley set the present value of the five lease payments at
$292,500, which is 100% of the fair value of the machinery, and the
rate implicit in the lease is 8%, what are the equal annual
payments?
PV Annuity
Due PV
Ordinary
Annuity
8%, 5
periods
4.31213
3.99271
Select one:
a.
$75,822
b.
$67,831
c.
$73,259
d.
$81,398