Essay
Standard Distributing entered into a leasing agreement with R & D Rental. The lease qualifies as a capital lease and calls for payments of $5,000 for 5 years with the first payment being made on January 1, 2011, and subsequent payments being made on December 31 of each year. Standard's incremental borrowing rate is 12 percent.
Prepare a schedule amortizing Standard's lease obligation.
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