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On January 1, 2014, LOR Leased a Machine (Original Cost

Question 125

Multiple Choice

On January 1, 2014, LOR leased a machine (original cost $60,000) to LES for a 5-year period at an implicit interest rate of 15 percent.The lease qualified as a direct financing lease and the annual lease payments ($17,306) are made each December 31.LOR retained the $4,000 estimated unguaranteed residual value , LOR's net receivable and LES's liability would be (round to the nearest dollar) : On January 1, 2014, LOR leased a machine (original cost $60,000) to LES for a 5-year period at an implicit interest rate of 15 percent.The lease qualified as a direct financing lease and the annual lease payments ($17,306) are made each December 31.LOR retained the $4,000 estimated unguaranteed residual value , LOR's net receivable and LES's liability would be (round to the nearest dollar) : A) Choice 1 B) Choice 2 C) Choice 3 D) Choice 4


A) Choice 1
B) Choice 2
C) Choice 3
D) Choice 4

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