A town signs a 10-year capital lease by which it acquires equipment with a market...
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Accounting
A town signs a 10-year capital lease by which it acquires equipment with a market value of $1M. The lease incorporates an implicit interest rate of 8% per year. Accordingly, annual lease payments are $149,029. When the town makes it second annual lease payment, it would report in its government-wide statements?
The answer is : interest expense of $74,478
How do you calculate this to get $74,478?
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