FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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8. What is the total amount of interest revenue will FOUR earn over the term of the lease?

₱ 75,000
 
 
 
₱ 129,360
 
 
 
₱ 139,450
 
 
 
₱ 51,600
FOUR Inc. leases computer equipment to customers under a direct financing lease. The
equipment has no residual value at the end of the lease and the leases do not contain bargain
purchase options. FOUR wishes to earn 8% interest on a 5-year lease of equipment with a fair
value of P323,400. The present value of an annuity due of 1 at 8% for 5 years is 4.312.
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Transcribed Image Text:FOUR Inc. leases computer equipment to customers under a direct financing lease. The equipment has no residual value at the end of the lease and the leases do not contain bargain purchase options. FOUR wishes to earn 8% interest on a 5-year lease of equipment with a fair value of P323,400. The present value of an annuity due of 1 at 8% for 5 years is 4.312.
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