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Adam Limited and Davies Limited enter into a lease agreement with the following terms: ...

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Accounting

Adam Limited and Davies Limited enter into a lease agreement with the following terms:
lease term is 3 years
estimated economic life of the leased asset is 6 years
3 x annual rental payments of $23000; each payment is made in arrears at year end
residual value at the end of the lease term is not guaranteed by the lessee
interest rate implicit in the lease is 7%
On inception date, the present value of the minimum lease payments is:
a. $69000
b. $64584
c. $64170
d. $60359
e. $65713

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