On January 1, 2020, Blossom Company leased equipment to Daylight Corporation. The following information pertains to this lease. 1. The term of the non-cancelable lease is 4 years. At the end of the lease term, Daylight has the option to purchase the equipment for $1,900, while the expected residual value at the end of the lease is $15,000. 2. Equal rental payments are due on January 1 of each year, beginning in 2020. 3. The fair value of the equipment on January 1,2020 , is $220,000, and its cost is $189,000. 4. The equipment has an economic life of 5 years. Daylight depreciates all of its equipment on a straight-line basis. 5. Blossom set the annual rental to ensure a 4% rate of return. Daylight's incremental borrowing rate is 5%, and the implicit rate of the lessor is unknown. 6. Collectibility of lease payments by the lessor is probable. Both the lessor and the lessee's accounting periods end on December 31. Calculate the amount of the annual rental payment. (Round answer to 0 decimal places, e.g. 5,275.) Annual rental payment $
Other questions asked by students
Menthol is a crystalline substance with a peppermint taste and odor. When 1.19 g of menthol...
Which of the following would be LEAST able to make bacteria more virulent and infectious?...
What was the Alpha helix Just making sure you downloaded and read the correct paper...
The time it takes to clean up after an anniversary party varies inversely as the...
Q1 Find Solution of f 2 3 and f 3 8 using Newton s Interpolation...
To go on a summer trip Henry borrows 700 He makes no payments until the...