Multiple Choice
On January 1,Blalock Company as lessee signed a ten-year noncancelable lease for a machine with annual payments of $60,000.The first payment was also made on January 1.Blalock appropriately treated this transaction as a capital lease.The ten lease payments have a present value of $405,000 at January 1,based on implicit interest of 10 percent.For the first year,Blalock should record interest expense of
A) $0.
B) $6,000.
C) $34,500.
D) $40,500.
Correct Answer:
Verified
Correct Answer:
Verified
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