For the Following Lease,determine the Minimum Present Value Calculation for the Lessee

For the following lease,determine the minimum present value calculation for the lessee.
$$\begin{array} { | l | l | } \hline \text { Annual payment (due at end of year) } & \$ 22,000 \\\hline \text { Lease term } & 5 \\\hline \text { Incremental rate } & 10 \% \\\hline \text { Implicit rate (unknown to lessee) } & 8 \% \\\hline \text { Executory costs } & 5,000 \\\hline\end{array}$$

A) 64,443
B) 67,876
C) 83,397
D) 87,840

Correct Answer:

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