Fitbit Ltd has leased a machine on the following terms: Date of entering lease 1 July 2019 Duration of lease 5 years Life of asset 6 years Unguaranteed residual value $40,000 Lease payments inception (at the start) $60,000 Annual payments (5) $65,000 Implied rate 11.0 % Required: Determine the Fair Value (rounded off) of the leased asset. (7 marks)
Fitbit Ltd has leased a machine on the following terms: Date of entering lease 1 July 2019 Duration of lease 5 years Life of asset 6 years Unguaranteed residual value $40,000 Lease payments inception (at the start) $60,000 Annual payments (5) $65,000 Implied rate 11.0 % Required: Determine the Fair Value (rounded off) of the leased asset. (7 marks)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Fitbit Ltd has leased a machine on the following terms:
Date of entering lease 1 July 2019
Duration of lease 5 years
Life of asset 6 years
Unguaranteed residual value $40,000
Lease payments inception (at the start) $60,000
Annual payments (5) $65,000
Implied rate 11.0 %
Required:
Determine the Fair Value (rounded off) of the leased asset. (7 marks)
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