QUESTION 39 On January 1, 2020, ABC Company signed a three-year lease for the acquisition of equipment. Monthly lease payments of $2,000, based on an annual interest rate of 12% are to be made every January 1, beginning with January 1, 2020. Compute the present value of the minimum lease payments for ABC Company for the capital lease. Following are appropriate factors from tables: Table % / n Present Value of annuity due $1 Present Value of ordinary annuity of $1 Present value of $1 12%/3 2.69005 2.40183 .07379 1%/36 30.40858 30.10751 .69892 $72,000 $60,215.02 $60,817.16 $71,512.41

QUESTION 39 On January 1, 2020, ABC Company signed a three-year lease for the acquisition of equipment. Monthly lease payments of $2,000, based on an annual interest rate of 12% are to be made every January 1, beginning with January 1, 2020. Compute the present value of the minimum lease payments for ABC Company for the capital lease. Following are appropriate factors from tables: Table % / n Present Value of annuity due $1 Present Value of ordinary annuity of $1 Present value of $1 12%/3 2.69005 2.40183 .07379 1%/36 30.40858 30.10751 .69892 $72,000 $60,215.02 $60,817.16 $71,512.41

Financial Reporting, Financial Statement Analysis and Valuation

8th Edition

ISBN:9781285190907

Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw

Chapter7: Financial Activities

Section: Chapter Questions

Problem 1AIC

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QUESTION 39

On January 1, 2020, ABC Company signed a three-year lease for the acquisition of equipment. Monthly lease payments of $2,000, based on an annual interest rate of 12% are to be made every January 1, beginning with January 1, 2020. Compute the present value of the minimum lease payments for ABC Company for the capital lease. Following are appropriate factors from tables:

Table

% / n

Present Value of annuity due $1

Present Value of ordinary annuity of $1

Present value of $1

12%/3

2.69005

2.40183

.07379

1%/36

30.40858

30.10751

.69892

		$72,000
		$60,215.02
		$60,817.16
		$71,512.41

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